Your business crossed borders. Did your insurance?
Luke Kelly interviews Rouen van Eck and Carien Ahdar
When your operations cross borders, your insurance program needs to keep up.
More Australian businesses are expanding internationally, whether that’s setting up manufacturing offshore, tapping into India’s booming tech workforce or establishing operations in the US. Global growth brings complex insurance and compliance obligations that can catch even well-run companies off guard.
This month, DKG Insurance Brokers’ Managing Director Luke Kelly sat down with Rouen van Eck, Executive General Manager, Insurance, Risk and Strategy and Carien Ahdar, Senior Financial and Professional Risks Insurance Broker to unpack the risks Australian businesses face when they expand globally and what brokers should be asking before it’s too late.
Luke: What’s the most common coverage gap you see for Australian companies with overseas operations?
Rouen: The biggest gap usually sits within the liabilities. General and Product Liability and Directors and Officers (D&O). Dependent on business activities, other lines such as Professional Indemnity could also require review. Some jurisdictions operate under what are known as “non‑admitted” insurance regimes. Jurisdictions such as the US, Canada, India, China and Malaysia, to name a few, require local policies issued by an in-country insurer, which then dovetail into the master program arranged on a global basis.
If your broker does not have the relevant expertise or awareness of such requirements, this risk can be missed.
Carien: This requirement follows from the non-admitted territory’s insurance regulations and legislation. A non-compliant insurance program can expose your business to tax liabilities and running afoul of local obligations.
Luke: When a claim occurs offshore, what are the biggest complications compared to a domestic claim?
Rouen: The biggest challenge is ensuring that your client’s representatives and staff on the ground in the overseas territory are properly informed about the company’s obligations under its insurance program. They must be familiar with claims protocols and understand how to engage with assessors, loss adjusters and legal representatives. If there is a manufacturing site in a foreign jurisdiction while the executive team is based in Australia, the staff in that foreign jurisdiction must be able to initiate the claims procedures and provide the necessary information. Without knowledgeable personnel on the ground, claims may stall.
As a broker, it’s imperative that you guide the customer and facilitate that transfer of information to whoever is handling the claim locally.
Carien: This is exactly why the local policy matters outside of the compliance requirements. When it’s placed properly, it affords you claims support on the ground through the insurer’s local partners and networks. It’s not just about coverage. It is also about having the infrastructure to respond when a claim occurs.
Luke: Are you seeing Australian businesses expanding into particular regions right now?
Carien: We’re seeing a noticeable move into India, particularly in the tech industry. The expertise is available and the economy is robust. We also see continued expansion into the US. Both India and US (barring a few states) are non-admitted territories. This requires careful design and structuring of the insurance program. This is achievable but brokers need to manage their client’s expectations around viable options and timelines.
Luke: How often does an Australian policy simply not respond overseas?
Rouen: Fortunately, it’s not a situation we have had to deal with. The key to success is getting the structure right from day one. If I get a broker of record appointment on an international program, I will not accept the appointment until I have full line of sight on the client’s business activities, territorial footprint and assessment whether their existing program is adequate. Multinational programs require a specific skill set and it’s not something every broker encounters regularly. It’s not just about placing the program. It’s about identifying that the multinational exposure exists in the first place and knowing what the triggers are. As a trusted business advisor, a skilled broker will be in regular contact with their client and know about the expansion plans for proactive planning.
Luke: If a customer has even one or two staff travelling or working overseas, what should brokers be checking?
Rouen: It seems straightforward, but it’s not. If staff are purely travelling for a week here and there, whether it’s a conference or a site visit, incidental visits are usually covered under a worldwide jurisdiction policy which your broker should be able to confirm. You need to ensure a travel policy is in place for unforeseen medical events, travel curtailment or loss of property.
But the moment they undertake any work abroad, everything changes. Setting up an office, a secondment to a customer or being domiciled in a territory for months, open a new conversation around local policies for property, liability, workers compensation and mandatory employee benefits. It’s a completely different risk profile.
Carien: The distinction matters. Attending a conference is a travel policy question. Being seconded to an overseas office requires a raft of different questions entirely. The broker’s duty is to do that deep dive and understand exactly what the customer’s people are planning to undertake in the overseas territory.
Luke: What’s the single most important piece of advice for businesses expanding internationally?
Rouen: A proper discovery should be undertaken. You need to understand the intimate details of what a customer is undertaking overseas. Is it a temporary visit under 90 days? A full office setup? Which territory, and what are the jurisdictional requirements? It’s never as simple as someone calling up and saying, “I need office cover in the Philippines.”
Business owners are great at what they do. They see cheaper labour and property rates and move on it. But they don’t necessarily consider the associated risks and exposure with such expansion. A knowledgeable broker who undertakes a proper discovery can identify, remedy and treat those exposures.
Carien: A broker’s information gathering does not stop at onboarding. Discovery is an ongoing process. You need continuous communication to avoid discovering at renewal that there is already a new operation in another territory. Make sure you understand the customer’s full corporate structure. It’s rarely just one entity. And get the right people in the room. You need the CEO at the table, not just an operations manager. They are charged with the strategic expansion plan.
Rouen: Insurer selection also becomes critical. A local insurer might be the right fit for Australian operations. For international locations, you need carriers with multinational capabilities such as local offices or fronting arrangements across most territories. A fragmented program is not ideal. You want a program aligned to a carrier that can seamlessly tie local policies into the Australian master policy.
That’s why the pre-renewal conversation matters so much. A skilled broker needs to be across the client’s expansion roadmap over the next one, three and five years. If they’ve got plans to go international, it needs to be factored into your insurer selection. Trying to restructure an insurance program midterm with an insurer that does not have multinational capabilities will result in a convoluted process that doesn’t deliver the best outcomes for the customer.
Luke: Is there anything beyond insurance that brokers should be flagging with their customers?
Rouen: We always make sure clients understand that we do not provide legal advice. As risk advisors, we need to challenge our customers and make them aware of potential pitfalls that can’t be solved with an insurance solution, such as trading with sanctioned territories. If you’re sending goods into sanctioned regions, those decisions can have material implications for your business well beyond insurance.
Carien: A broker becomes a trusted business advisor to a client where you undertake a proper discovery, provide sound advice and options to your client and build the relationship. You’re invited to board meetings, and you encourage engagement with the board. You are asked to review contracts before they’re signed. You’re advising on risks that extend beyond the policy coverage. Importantly, you never take the place of a lawyer and encourage your client to seek independent legal advice.
Rouen: A multinational program is never based on a cookie cutter approach. It’s a bespoke solution that can only come through proper discovery and intimate knowledge of your client’s business activities and territorial footprint. You don’t run it through a quote platform and get five quotes back. It requires skilled and ongoing negotiation with the underwriters to achieve the required cover (terms, wordings and endorsements) for your client. It’s a true risk-managed approach. It requires expertise, information and time to get it right.
The bottom line
International expansion is exciting, but the insurance and compliance landscape that accompanies this are complex, jurisdiction-specific and unforgiving if you get it wrong. The difference between being properly protected and dangerously exposed often comes down to having an experienced broker on your side.
If your business has operations, staff or plans overseas, make sure your broker has the multinational expertise to match.
Ready to review your international risk program? Talk to the DKG team today on 1800 252 926 or email insurance@dkg.com.au.
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