7 Commercial Insurance FAQ’s
Here are a selection of FAQ’s often asked by clients regarding their commercial insurance. From property insurance and office cover to contractors and full commercial combined policies, its important you understand your cover.
1) What is an excess/deductible?
Most policies have an excess of some kind. You will be responsible for the excess (for example £250) and the remaining amount of the claim is paid by the insurers. This is to prevent a number of small claims being submitted to insurers and helps to keep the premium down. In some cases you can increase the excess and reduce the premium. You should however always keep the excess to a reasonable amount. Insurers may place a compulsory excess on the policy where they set the amount. Some insurers are placing a £10,000 excesses in respect of flood in some areas.
2) Do I need terrorism cover?
It is not compulsory but HIGHLY recommended. If you have a loan or mortgage secured against your business, the bank will insist you maintain cover. We have produced an information page you can read here which provides further information on this peril.
3) What cover do I have to have by law?
Motor and employers liability (if you are employing staff) are required by law. Some trades have to carry professional indemnity insurance (insurance brokers as an example!). Although you may not require a particular insurance cover by law, you should carry adequate cover to protect your business and its staff. If you have a loss you risk loosing everything you have built up if you are not insured.
4) Why do I need a disaster recovery plan?
In the event of a claim you know to tell insurers but what do you have a plan to keep the business running? Where do you go for IT support? Can you obtain more stock if you have a fire? Where can you operate your business from if the building is flooded? There are many situations that can arise. A disaster recovery plan will keep your loss to a minimum and ensure your business can continue to run smoothly. Check out our information here.
5) What if my business changes during the year?
Your insurance has to be able to change as your business changes and grows. Its essential you keep your insurers in the picture and up to date with your operations. Insurers want to know if you change your sales line or enter into another field of expertise. If you need to increase sums insured or add items, your insurance policy will be totally flexible. Your broker should be there to support and advise you with any changes that you may need to make.
6) How do I make my insurance cheaper?
Make sure you have a good insurance broker! Your broker should review the market and make sure you have the best policy available for your business. Remember: There is always a rate for the risk. Driving your premium too far down may leave you with a policy that is not worth the paper it is written on. If your insurance policy seems very cheap, make sure you have the background on the insurance company. If you have never heard of them, be careful. Like buying a product, if it is too cheap to be true, it probably is. The last thing you want is to find out the insurance company you are with is not going to pay out when you have a claim.
7) Why should I use broker?
When arranging your commercial insurance, a broker will approach the market and obtain the best quote and cover available. Often you will find your commercial portfolio will be made up of several different insurance companies. This is because some insurers specialise in certain parts of a risk and a portfolio has to be built with several different sections. Unlike going to a direct insurer or through a compare website for a single motor or household insurance, commercial insurance remains very technical and relies on the expertise of the broker and insurers to create a policy which will cover your business needs. A broker will look after your needs and support you through out the life of your policy, providing advice and helping if a claim occurs.
To discuss your commercial insurance requirements further contact us on 01707 883377 or email us on info@bromwall.com
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