Here’s How Business Legal Cover Can Mitigate Your Legal Risks.
Legal matters can cost your company a lot of Rands and time. A successful business cannot afford to risk large amounts of money on potential lawsuits. This is where Business Legal Cover can assist in mitigating the risks involved in legal matters. If you’re searching for ways to lower the risk your company is exposed to, mitigating legal risks can contribute to the stability of your bottom line. Secure the profitability of your endeavours and reduce stress related to concerns you might be sued with business legal cover.
What is Business Legal Cover in South Africa?
Business Legal Cover is a form of insurance that provides businesses with cover for the cost of legal services involving their company. Legal costs are often incurred when seeking legal representation or advice. If you need an attorney, lawyer, or legal professional’s services, business legal cover comes into play. You can cover labour matters, civil matters, commercial contracts, debt collection, and more.
What are the Biggest Legal Business Risks to My Company?
Depending on your business operations, your company will face risks. Risks are found in each area of business operation. When assessing your company for legal risks, you’re asking where you might have to spend money on lawyers, legal matters, lawsuits, and similar instances. You are asking where your company faces the risk of being sued.
Most companies will have some common legal risks, while unique industries may include risks beyond those discussed in this article, for example breach of contract cases. Each business owner should assess their own company for legal risks, perhaps with the assistance of a legal professional. The owner understands the ins and outs of their own business and its operations, while a legal professional may offer insight into what risks exist.
Claims and Disputes by Employees
Employees can file legal claims against their employers under various circumstances supported by the South African Labour Law. When exercising any rights within the Labour Relations Act or participating in proceedings in terms of the act, their claims could cause you stress and cost your company a lot of money. Aside from matters in the South African Labour Law, employees can also submit legal claims against their employer when they are taking part in a legal strike or in lawful union activities.
Other cases where employees can legally claim against you would be if they are dismissed for any reason related to pregnancy, refusing to accept a change in work conditions, being arbitrarily discriminated against, or are dismissed after a disclosure made by the employee in terms of the Disclosure of Information Act. While your business insurance may cover some cases, Business Legal Cover can fill in the gap between what your insurance is paying and not paying.
Breach of Contract Cases
If your business enters into a contract and does not honour a condition or conditions in the contract, the relevant party can institute a claim against you. Legal claims due to breaches in contract can also be called contractual liabilities. These liabilities are not the same as liability incurred through negligence.
Other Legal Risks
Other legal claims risks your company could face are allegations of criminal behaviour or activities and trademark and copyright matters. According to a 2019 report, liability claims, where someone claims against your company for a liability, have also increased in frequency and in the cost to the liable party substantially. For this reason, personal injury and other liability claims should also be covered by the business legal cover you choose.
How to Mitigate Business Legal Risks
1. Familiarise Yourself with Laws Related to Your Company. These can include industry-specific legislation and regulations, the Consumer Protection Act, the National Credit Act, the Labour Relations Act, The Broad-Based Black Economic Empowerment Act, and the Protection of Personal Information Act.
2. Develop Policies to Lower Risks Related to Your Business. The purpose of these policies would be to avoid penalties and disputes and to regulate relationships, in whichever form. Examples include policies on social media marketing and engagement, grievance policies, and returns and refunds policies.
3. Make Sure Legally Binding Contracts Are in Place with All Relevant Parties. Contracts should take the form of written agreements that detail the obligations of each party and the consequences of failure to perform.
4. Take Cautionary Measures to Protect Capital. When investing or taking out loans, consider the risks involved like variable interest rates and other repayment terms. Other ways of increasing capital can also expose you to risk, like shareholders and shareholder agreements. One of the ways to protect your bottom line is to find Business Legal Cover that can cater to all the legal risks you have identified.
Finding a way to mitigate legal risks that is low cost is easy. Purchase business legal cover that you have researched to ensure it will cover your risks. For a low monthly payment, you can gain access to a knowledgeable business lawyer and other essential legal services. Business legal cover makes it possible for you to receive legal counsel from professionals regarding compliance, contractual obligations, employment laws, and other relevant legal matters. When you combine business legal cover with other business insurance like liability insurance, you can easily expand the scope of your cover without a large investment.
DISCLAIMER: The information provided in this article is meant for informational purposes only and should not be construed as legal, medical, or financial advice. Facts stated in this article are correct at the time it was published.