Almost two-thirds of dotcom companies fail within their first year because they do not pay enough attention to the day-to-day risks of trading on the internet.

The Ferma forum will feature a workshop on understanding the risks in e-commerce. It will be led by Balfour Beatty group insurance manager Stuart Martin, Lloyds TSB manager of insurable risk Amanda Roper and HSBC insurance and risk manager Damian McNamara.

Martin said recent figures from the Department of Trade and Industry (DTI) showed as many as 64% of internet start-ups failed within their first year.

“These companies don't look at the logistics of e-commerce, nor the support services they require,” he says. “A great many dot-com companies are simply not providing the products or services they are advertising.”

Martin also says few know how to market their site correctly and fail to address the logistical aspect of transactions and product delivery.

“New companies need to look in advance at areas such as manufacturing or sourcing the product, financing, downstream procurement and how they will be paid,” Martin says.

“They also need to be very sure about their insurance requirements.

“Because of the lack of comprehensive risk management packages to rely on, they must manage the business cycle.”

The workshop team, all members of the Association of Insurance and Risk Managers (Airmic), will run an interactive session that was developed by Airmic's e-commerce special interest group.