Consider yourself a fast growing tech business? Are your insurances on that journey with you?

In recent years, Australian technology firms have continued to demonstrate that there is enormous opportunity residing in the tech sector. With businesses such as Atlassian and Canva paving the way for tech startups, it is no surprise that there are a huge number of ‘soonicorns’ coming through the ranks.

The innovations and solutions developed by Australian tech companies are likely to play a huge part in boosting the Australian economy over the next few years. According to the Australian Government, a range of emerging technologies are forecast to change and improve many fundamental tasks and interactions in the coming years; including how we work, travel, and communicate with each other^[1].

Technologies such as artificial intelligence, blockchain and quantum computing, present significant opportunities for people, businesses and the broader economy, but managing the associated risk and insurance implications that also inevitably follow can often be a demanding task. We have seen multiple tech companies go from startup to market domination within just a matter of years, so it is no surprise that keeping up with their evolving risks can be challenging.

How and why should tech firms understand and manage their risk and insurance requirements?

When advancing from a startup to an Initial Public Offering (IPO) in such a short period of time, risk management and insurance considerations are unlikely to be a privately owned tech company’s primary concern. However, irrespective of size, there are risk implications from the moment a business is launched. The right risk transfer solutions can both help organisations protect themselves against litigation and other risks, and also present opportunities for competitive differentiation and growth.

An effective approach to risk management and insurance offers benefits including:

Enhancing a company’s credibility by showing prospective clients, customers, and investors that an organisation takes safety seriously.
Helping to attract and retain directors and officers and employees.
Satisfying contractual obligations by providing certainty of insurance coverage in the event of a future transaction (such as, an IPO, merger, or acquisition).

All of this can only be achieved by selecting the right risk and insurance broking partner that has both the capability and expertise to support you as your business continues to grow, and also the knowledge to assist in navigating the sometimes confusing insurance landscape. This will ensure you get the right coverage at an appropriate cost.

Tech businesses need the right products and services for their needs

The unique combination of exposures facing the technology industry require a specialised and comprehensive approach to risk management and insurance.

Marsh serves technology companies of all sizes, and can offer multiple solutions designed to meet the needs of these firms, including:

Specialised policy forms designed specifically to address the varied risks faced by tech firms.
Services that can keep up with the pace. Growing tech businesses need a partner that can grow with them and offer risk management solutions from launch and through multiple rounds of funding.

Commitment to your needs

Marsh has established a dedicated practice group focused specifically on Australian tech risks, with representatives from a number of specialities, including Financial and Professional Liability (FINPRO), Cyber, Risk Consulting and Private Equity and Mergers and Acquisitions. Our multidisciplinary team understands the needs of tech clients and can help effectively manage and transfer their risks.
We provide coordinated global guidance and program management. As you expand your services beyond national borders, our global team can guide you through the patchwork of local insurance regulations and customs to help plan the developing strategy.
Marsh also has in-house consultants to help minimise risk. As tech businesses evolve, they often face new and unexpected risks. Marsh’s consulting teams are highly skilled in providing qualitative and quantitative risk assessments and can collaborate with clients on risk mitigation and executive preparedness strategies.

Next Steps

To further understand your organisation’s exposures and which potential risk management and insurance solutions may assist, please contact your Marsh representative, or speak to one of our specialists.

^[1]https://www.industry.gov.au/sites/default/files/2018-12/australias-tech-future.pdf

^[2]https://digi.org.au/wp-content/uploads/2019/09/Australias-Digital-Opportunity.pdf

Any statements concerning actuarial, tax, accounting, or legal matters are based solely on our experience as insurance brokers and risk consultants and are not to be relied upon as actuarial, accounting, tax, or legal advice, for which you should consult your own professional advisors.

Marsh makes no representation or warranty concerning the application of policy wordings or the financial condition or solvency of insurers or re-insurers. Marsh makes no assurances regarding the availability, cost, or terms of insurance coverage.

“Marsh Pty Ltd (ABN 86 004 651 512, AFSL 238983) (“Marsh”) arrange this insurance and is not the insurer. The Discretionary Trust Arrangement is issued by the Trustee, JLT Group Services Pty Ltd (ABN 26 004 485 214, AFSL 417964) (“JGS”). JGS is part of the Marsh group of companies. Any advice in relation to the Discretionary Trust Arrangement is provided by JLT Risk Solutions Pty Ltd (ABN 69 009 098 864, AFSL 226827) which is a related entity of Marsh. The cover provided by the Discretionary Trust Arrangement is subject to the Trustee’s discretion and/or the relevant policy terms, conditions and exclusions. This website contains general information, does not take into account your individual objectives, financial situation or needs and may not suit your personal circumstances. For full details of the terms, conditions and limitations of the covers and before making any decision about whether to acquire a product, refer to the specific policy wordings and/or Product Disclosure Statements available from JLT Risk Solutions on request. Full information can be found in the JLT Risk Solutions Financial Services Guide.”