Buyers Guide to Business Insurance

How Insurance Works
Things to look out for
How to make a claim
What happens when things go wrong?

Any business faces unpredictable threats and risks on a daily basis. A fire, theft or injury may destroy everything your company stands for. To protect yourself from the unforeseen and make sure your business survives, it is essential that you purchase the right business insurance. For a competitive premium your policy will ensure you are protected from a range of pre-specified risks. Because every business is different, we use our knowledge and experience to create bespoke insurance solutions providing a variety of different cover.

To help you determine which policy is best for you and to find you the most competitive premium, we have partnerships with all of the leading, major insurers including Allianz Cornhill, Axa, Ecclesiastical, Fortis, Groupama, MMA, NIG, Norwich Union, Royal & Sun Alliance and Zurich. We are also represented in Lloyd’s and have numerous partners within this market providing specialist advice and bespoke policies.

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How Insurance Works

In most cases, a business will need a number of different types of insurance to ensure that you are adequately covered from possible loss or damage and to protect you from any potential liability. An alternative to researching and purchasing different types of insurance separately is to buy a packaged insurance policy.

A packaged policy is a product that offers a variety of cover and numerous benefits. These products are usually aimed at SME-sized businesses and provide protection against your physical assets and your liabilities. It is also easier to administer as you have a single set of documents, one annual premium to pay and one renewal date. Packages are often less expensive as insurers will offer a more competitive, total premium when they are providing a combination of cover.

The following types of cover are common, highly practical and a legal requirement in certain cases.

Employers Liability - If you employ anyone outside your immediate family, you are required by law to purchase employer's liability insurance. This insurance offers you protection for your legal liability arising from injury or illness or death sustained by employees while they are working for you.
Public Liability - This will protect your legal liability for bodily injury or damage to a third party or their property that may occur during the normal operation of your business.
Products Liability - This will protect your legal liability for bodily injury or damage to a third party or their property that may occur from products you sold or supplied.
Professional Indemnity - If you provide advice or a service, it is highly recommended that you consider this type of insurance. The policy will provide protection in the event of your business providing negligent advice, errors or omissions resulting in a financial loss.
Material Damage - There are several different insurances that are designed to cover your physical assets including buildings, computer equipment, stock or contents from loss or damage caused by various events such as fire, flood, theft etc.
Business Interruption - This covers your future earnings of the business resulting from a loss caused by an insured peril that has prevented the normal operation of your business.
Money - In specific circumstances this will cover you for money that is lost or stolen from the business premises or whilst in transit to the bank.
Goods in Transit - Covers you for accidental loss, destruction or damage to goods in transit and the cost of alternative transport if needed.
Motor - If you use a motor vehicle, you have to meet your legal obligations by insuring the vehicle for a minimum of third party cover. You should also strongly consider extending your cover to comprehensive which includes a range of additional cover and benefits.
Other types - Depending on the nature of your business, other insurances may need to be considered including Directors’ & Officers’, Legal Expenses, Efficacy, Homeworker and Contractors All Risks.

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Things to look out for

Excess - An excess is the first part of every claim that you are responsible for. Usually you can reduce the cost of your insurance by increasing the level of excess.
Sum Insured - It is your responsibility, and vitally important, to provide us with accurate information regarding the value of your assets. In some circumstances, incorrectly valuing the amount to be insured could affect your claim. If you cover your assets for less then they are worth (under-insure), you will not receive enough compensation to cover your losses. We will be happy to discuss this with you and help you to calculate your sum insured. In some cases an insurer may wish to survey your premises before agreeing to provide cover.
Policy Conditions, Exclusions & Warranties - Understanding how you are covered, is as important as understanding how much you are covered for. You should be aware of any conditions, exclusions or warranties that may exist with the cover. For example some cover is dependent on you having an alarm fitted or securing your equipment in a particular way. Full details can be found by referring to your policy wording in-conjunction with your schedule of cover.
Know your insurance company - As part of your decision making process you should look beyond the cost of the cover and examine the potential insurance provider. It is always better to pay a higher premium but deal with an established and financially secure insurer.

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How to make a claim

Usually the process of making a claim is relatively simple but when a disaster occurs it's easy to become confused.

Do notify us as soon as possible
Do tell the police immediately if you have suffered a theft or malicious damage.
Do take all possible action to prevent further loss or damage and thereby minimise or reduce the loss
Do not admit liability or offer to pay compensation to anyone. Pass all correspondence to us, unanswered immediately.
Do tell us immediately if you receive a solicitors letter, summons, notice of prosecution or similar communication and do not acknowledge it.
Do take any immediate action possible to prevent it happening again.

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What happens when things go wrong?

Although we always aim to provide a high level of customer service and actively promote the services of reputable and fair insurers, we appreciate that sometimes, things can go wrong.

Our reputation matters to us and we are conscious of the need to provide you with an explanation when claims are not met.

Listed below are some general problems that can occur and why:

Reason & responsibility…
Clients are expected to take reasonable care of their property in order to prevent theft or accidents. If you fail to do so, such as leaving the keys in the ignition of a vehicle or a laptop computer on the back seat, you are running the risk of a rejected claim.

It was bound to happen…
A client who persists with an action that is inevitably bound to produce a claim is heading for insurance headaches. An example is someone who continues to sell faulty goods, knowing they will cause injury or damage but nevertheless trying to evade the costs of recalling them.

Sensible maintenance…
Damage to property that doesn’t have a specific cause – like a leaking felt roof that has been neglected.

Wisdom & warranties…
Insurance often insists upon certain policy warranties: e.g. alarms must be switched on, sprinklers should be working or hazardous materials properly stored. To ensure that the policy cover is operating these warranties must be complied with.

Delayed reaction…
Payment of a claim could be refused if an Insurer feels that the case has been prejudiced because of late notification.

Hurt pride & unnecessary prejudice…
If a client immediately accepts responsibility, the Insurers may feel that their ability to defend the action has been prejudiced and may therefore refuse it.

Fact or fiction…
Insurance works on the principle that you alone know the full details of the risks you face. If you fail to disclose to the Insurer something that is thought to be important, then they may well refuse to pay subsequent claims.

What’s covered…
You need to know what your exclusion clauses are. They should be explained to you and included in your policy wording and schedule.

Detail is the key…
A rejected insurance claim is highly inconvenient and can lead to your business suffering financial problems. You and your senior employees should understand your insurance and, in particular, the conditions and warranties of your cover. You must tell us about any changes in your business or circumstances which may affect your insurance and notify us immediately of any potential claim. You must also check that you meet the requirements of your conditions of insurance.

This may take minutes of management but it will save months of misery.

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