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Insurance for start-ups and scale-ups:
Everything you need from a specialist broker

"Thinking through innovative business models and creating new risk maps to make risks insurable in the European or UK market is one of our core competencies and inspires me every day."

What start-ups really need for insurance and which risks should be actively managed:

Risk management may understandably not be at the top of a start-up's list of priorities, but it is ultimately of crucial importance, as the Watchmaster case shows.

As riskand insurance managers , we support you increating a suitable risk transfer concept. Depending on your business model (product / services), we translate the risks into a viable management / insurance concept. For example, cyber / IT liability and IP risks can threaten the existence of a SaaS case, while food start-ups have to deal more with recall costs and product liability in the context of personal injury and property damage. Subtle differences can have a fundamental impact on insurance cover, which is why a clear translation of your risks is crucial in order to have the relevant insurance in place in the event of a loss that threatens your existence.

Our experts will be happy to assist you, even with business model changes.

Suggested procedure: In order to address your risks appropriately, it is important to understand your business model in detail. We therefore suggest a non-binding meeting where we can discuss your concerns. If desired, we can also agree a non-disclosure agreement (NDA). At the end of this meeting and after presenting our concept, you will have the opportunity to decide whether we will become your Risk Partners.

In addition, our free guides are available to you, in which we have not only invested a lot of time, but also our extensive claims experience. 

Florian was recently invited to the #VentureMate podcast with Artur Schneider and Luca Grunwald from the HHL Venture Capital Club and talked about our experiences in risk management.

Whether you're a founder, VC or any other role from the startup world, our founder Florian gives you first-hand insights and experiences on typical (liability) risks and what you can do about them in the episode. Some of the topics we discuss there:

  • What liability do founders actually bear personally? You can also request our free guide "Liability of managing directors: digital & effective prevention" together with Fides Technology and the leading commercial law firm ESCHE SCHÜMANN COMMICHAU below. 
  • What risks typically arise for startups per funding stage and how can these risks be properly managed and hedged? 
  • What are the liability risks for VCs and their fund managers? What are the solutions for these risks, e.g. from the board or advisory seat? (More on this under "Specialty" Venture Capital)
  • What makes the life sciences industry so special and what should biotech, pharma and medtech startups consider to manage the "downsides" on the road to scientific breakthroughs? (More on this under "Specialty" Life Sciences)

Special features for growth companies from Series B to E (to IPO): D&O insurance

Venture capital-financed growth companies have to manage special requirements from investors and stakeholders with each financing round. In some cases, these are also set out in the term sheets (especially for US investors). The balancing act of the liability fields becomes greater for all parties involved as the exit / IPO draws closer. We are the only specialist broker in Germany to support companies with a focus on VC-financed growth throughout all phases.

We have also developed special insurance concepts in our specialist area of D&O insurance for start-ups and scale-ups for which an IPO is a possible scenario in the next few years:

  • D&O Growth Concept, with dynamic adjustments to the sums insured for milestone developments and better protection for preparatory acts in the context of an IPO(find out more about D&O insurance for founders).
  • Pre-IPO Readiness Check of the D&O insurance - Ask our experts what you should pay attention to in the design of your D&O when an IPO is imminent and thus protect supervisory and management boards in order not to fall into liability traps on the IPO project and to cover risks professionally(learn more).
  • Risk Partners D&O solution with IPO flip for all those planning an IPO in the medium term can be worthwhile in order to maintain the necessary continuity of D&O insurance and to find an insurer that is also committed to new capacities in the context of your IPO. Particularly in the case of US listings, the conditions change significantly from "private to public" and many insurers are not allowed to accompany US listings due to underwriting guidelines. The "small print" should also take account of the new leading liability regime. With our innovative IPO flip concept, we convert the cover into adequate protection for a then listed company in the German or US liability regime, so that you are also protected against claims from shareholders, investors and securities (class) actions (Securites Class Action or Capital Model Proceedings Act (KapMuG)) in the future. 

Special features for growth companies from the Seed / Series A phase: Keyman Insurance / Dread Disease Insurance

If there is a key person in your company, such as a "super brain" from IT or a special leader from the founding team, who is crucial to the success of your company, without whom the company would be worse off both financially and in terms of its positive outlook, key person insurance(keyman insurance) should be considered. This insurance is basically cover for a health event in the key person and pays out in the event of a prolonged absence of the key person in your company. Although the insurance benefit cannot prevent the loss of the key person, it can cover the costs of recruiting via headhunters, attractive signing bonuses or higher salaries for highly qualified replacements. An experienced partner for the recruitment of highly qualified personnel can often close the gap quickly. Many VCs now include the requirement for key person insurance in the term sheets in order to "hedge" the exposure and special dependency of an individual from the founding team. Particularly in the context of an investment in the (pre-)seed phase, the investment decision is often based on trust in the founding team. 

Special features of scale-ups and IPO readiness in risk management: risk management as a service

Especially for scale-ups and pre-IPO companies, it is important to develop simple and viable (risk management) concepts that manage or transfer the key risks in order to avoid insolvency of the business model in the worst-case scenario. On request, we therefore go beyond the classic services of a specialist broker with our "risk management as a service" approach and support you in setting up risk management (spoiler: this will play a significant role in later due diligences / IPO prospects). From a risk management perspective, it is essential to create a common risk awareness in the first step, which is largely supported by the risk strategy. If you wish, we can develop this with you so that you can subsequently impress your investors in the due diligence process with a risk report and a deep understanding of your risks and the risk transfer of risks that threaten your company's existence.

On the basis of sound risk and insurance management, we develop a decision-making basis for your company. You decide what to insure and what not to insure. Because not every risk is worth insuring. Here is our basic approach:

  • Risk identification in joint risk workshops, coupled with our experience in industry-typical risks for life sciences, FinTech, tech companies and venture capital-financed companies
  • Risk analysis and assessment (software-supported on request)
  • Development of a joint risk management strategy (Which risks can be avoided, reduced and / or transferred? Which ones can we accept as non-critical?)
  • Determination of your company's risk-bearing capacity and risk acceptance and impact analysis on KPIs in your balance sheet (how much risk can you afford or do you want to take?)
  • Creation of an insurance strategy (What risk should be borne by the company itself, what should be insured? Goal: Minimization of risk premiums)
  • Implementation and placement of risk and insurance strategies on the insurance market

Your added value through active risk and insurance management:

  • Sustainably increase the security level for your company
  • Value-oriented risk management will lift your valuation in the next financing round
  • Significantly reduce the cost of your insurance
  • Manage and process claims more efficiently
  • CONSCIOUSLY take risks and promote growth!

The Silicon Valley Bank case, which was identified as part of a risk management process and - if necessary - would have led to an adjustment of the banking strategy, also demonstrated the importance for young growth companies.

Our services

A holistic approach to risk management

We place identified and insurable risks on the global insurance markets for you in the best possible way. We know that this does not always solve all your challenges. Strong growth can lead to bottlenecks in the insurance department and/or a professionalization of risk management may be necessary. We can help you with this.

For startups, scaleups & life sciences companies

Risk management as a service

It is particularly important for start-ups and pre-IPO companies to develop simple and less complex (risk management) concepts. These must identify, assess and transfer the key risks in order to avoid the insolvency of the business model in the worst case scenario.
⭢ see the Watchmaster case, for example.

From a risk management perspective, it is essential to create a common risk awareness in the first step, which is largely supported by the risk strategy. Convince your investors in the due diligence process of your next financing round with a risk report and a deep understanding of your risks, thereby safeguarding against risks that could threaten your company's existence.

On the basis of sound risk and insurance management, we develop a decision-making basis for your company. You decide what to insure and what not to insure. Because not every risk is worth insuring. Here is our basic approach:

  • Risk identification in joint risk workshops, coupled with our experience in industry-typical risks for life sciences, FinTech, tech companies and venture capital firms
  • Risk analysis and assessment (software supported on request)
  • Development of a joint risk management strategy (Which risks can be accepted, avoided, reduced or transferred?)
  • Determination of your company's risk-bearing capacity and risk acceptance and impact analysis on KPIs in your balance sheet (how much risk can you afford or do you want to take?)
  • Creation of an insurance strategy (what risk should be borne by the company, what should be insured? Goal: Minimization of risk premiums)
  • Implementation and placement of risk and insurance strategies on the insurance market

 

Your added value through active risk and insurance management:

  • Sustainably increase the security level for your company
  • Value-oriented risk management will boost your valuation in the next financing round
  • Significantly reduce your insurance costs
  • Manage and process claims more efficiently
  • CONSCIOUSLY take risks and promote growth!

 

The importance of this for young growth companies was demonstrated not least by the Silicon Valley Bank case, which was identified as part of a risk management process and - if necessary - would have led to an adjustment of the banking/treasury strategy.

From a risk management perspective, it is essential to create a shared risk awareness in the first step, which is largely supported by the risk strategy. Convince your investors in the due diligence process of your next financing round with a risk report and a deep understanding of your risks and hedge against risks that could threaten your existence.

On the basis of sound risk and insurance management, we develop a decision-making basis for your company. You decide what to insure and what not to insure. Because not every risk is worth insuring. Here is our basic approach:

  • Risk identification in joint risk workshops, coupled with our experience in industry-typical risks for life sciences, FinTech, tech companies and venture capital firms
  • Risk analysis and assessment (software-supported on request)
  • Development of a joint risk management strategy (Which risks can be accepted, avoided, reduced or transferred?)
  • Determination of your company's risk-bearing capacity and risk acceptance and impact analysis on KPIs in your balance sheet (how much risk can you afford or do you want to take?)
  • Creation of an insurance strategy (what risk should be borne by the company, what should be insured? Goal: Minimization of risk premiums)
  • Implementation and placement of risk and insurance strategies on the insurance market
 

Your added value through active risk and insurance management:

  • Sustainably increase the security level for your company
  • Value-oriented risk management will lift your valuation in the next financing round
  • Significantly reduce the cost of your insurance
  • Manage and process claims more efficiently
  • CONSCIOUSLY take risks and promote growth!
 

The Silicon Valley Bank case, which was identified as part of a risk management process and - if necessary - would have led to an adjustment of the banking / treasury strategy, also demonstrated the importance for young growth companies.

For listed corporations and SMEs

Rent-an-Insurance-Manager

We place identified and insurable risks on the global insurance markets for you in the best possible way. We know that this does not always solve all your challenges. Strong growth can lead to bottlenecks in the insurance department and/or a professionalization of risk management may be necessary. We can help you with this.

On the other hand, many companies do not (yet) have an insurance department with their own staff or cannot find suitable personnel. Above a certain size, your industrial risk and insurance issues require professional support to ensure that your investments and strategies are adequately protected. This is where we provide you with support tailored to your needs.

Building up your own staff to deal with your internal insurance issues is time-consuming and cost-intensive. This work is often carried out by the head of finance or legal, for example, but not by professionally trained insurance staff.

Our solution for your company: Rent-an-Insurance-Manager

  • Rent your "own" insurance department for a certain period of the year
  • Simply outsource the management and administration of insurance contracts
  • Reduce costs - increase security

Our "Rent-an-Insurance-Manager" concept allows you to hire core competencies in the field of insurance for a limited period of time and tailored to your needs, as if you had your own staff in place.

As an outsourced insurance department, Risk Partners manages and handles your company's insurance work, e.g. as an in-house contact for insurance issues, an interface to your insurance broker or to your insurers.

Your added value through Rent-an-Insurance-Manager:

  • Efficient use of personnel and costs. Existing processes are optimized while at the same time freeing up your internal resources in their specialist areas (legal/finance)
  • "Bookable on a temporary basis", for example if you have staff shortages during peak periods such as renewals or annual financial statements and need support at short notice
  • Saves time: freed-up capacity can be used in other core areas of your company
  • "Professional sparring" relieves and supports your existing team with a second opinion
  • Professional support for your insurance issues through the use of qualified insurance expertise
  • By increasing the quality of work, you also reduce risks for your management's liability

On the other hand, many companies do not (yet) have an insurance department with their own staff or cannot find suitable personnel. Above a certain size, your industrial risk and insurance issues require professional support to ensure that your investments and strategies are adequately protected. This is where we can provide you with support tailored to your needs.

Building up your own staff to deal with your internal insurance issues is time-consuming and cost-intensive. This work is often carried out by the head of finance or legal, for example, but not by professionally trained insurance staff.

Our solution for your company: Rent-an-Insurance-Manager

  • Hire your "own" insurance department for a certain period of the year
  • Simply outsource the management and administration of insurance contracts
  • Reduce costs - increase security

With our "Rent-an-Insurance-Manager" concept, you can hire core competencies in the insurance sector for a limited period of time and tailored to your needs, just as if you had your own staff in place.

As an outsourced insurance department, the Risk Partners manage and take care of your company's insurance work, e.g. as an in-house contact for insurance issues, interface to your insurance broker or to your insurers.

Your added value through Rent-an-Insurance-Manager:

  • Efficient use of personnel and costs. Existing processes are optimized while at the same time freeing up your internal resources in their specialist areas (legal / finance)
  • "Bookable on a temporary basis", for example if you have staff shortages during peak periods such as renewals or annual financial statements and need support at short notice
  • Time savings: Freeing up existing capacities can be used in other core areas of your company
  • "Professional sparring" relieves and supports your existing team with a second opinion
  • Professional support for your insurance issues through the use of qualified insurance expertise
  • By increasing the quality of work, you also reduce risks for your management's liability

Benefit from our expert knowledge

Request our guides now

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We will be happy to advise you in a free initial consultation.

Guide "Liability of managing directors" available free of charge!

How to avoid liability digitally and effectively as a business manager in 2024 and protect yourself properly for worst-case scenarios.