Despite public statements by insurers to the contrary, it is possible to purchase some forms of Year 2000 Problem insurance.
National Insurance Brokers Association chief executive Noel Pettersen said some cover was available.
“Insurance for Y2K losses is difficult to buy, however it is possible, at a price, under certain conditions and only from certain insurers,” Mr Pettersen said.
“To get it, a business may have to accept one, or a combination of, conditions such as a higher deductible, maximum claims limit or it may have to be audited.
“Such cover is not marketed or advertised. It is usually independently negotiated with the help of an insurance broker.
“To negotiate it a business will need to be able to demonstrate it is a safe bet and has done everything possible to ensure it and its suppliers are Y2K compliant.
“Insurance companies are urging businesses to take a risk management approach but it is of concern that recent Australian Bureau of Statistics reports indicated 42 per cent of businesses had no plans to take action.
“The problem is worst with small businesses,” he said.
Mr Pettersen said without specially negotiated cover, few types of insurance would provide any protection for the Y2K problem including:
l Directors and officers insurance with many insurers inserting exclusion clauses to their policies or refusing to provide cover without an audit
l Professional indemnity with exclusion clauses being added to most policies — especially for advisers who are providing support for Y2K compliance.
