Buying insurance is often taken for granted. For personal insurances the buyer will usually start on the internet, whether to get a quote or to find a broker. One or maybe two products are bought on average, maybe a motor policy and legal expenses or a household policy. Price is often the key driver for making the decision.When buying commercial insurance, the same applies, right? Well actually, no. There are far more things that should be taken into consideration. After all, your business is at risk if things go wrong. Here are some things to look out for:
Buying InsuranceA commercial insurance portfolio is often made up of several different insurers, each providing a different class of cover. For example a motor fleet insurer, liability insurer, professional indemnity insurer. Each class of cover has its own specialists and unlike personal insurance, they will often stick to their own areas of expertise. A commercial broker will be able to advise the cover you require and also additional covers you should be aware of and may wish to consider to protect your business. Unlike personal insurance, if too many brokers or insurers are approached, you can find the market will not provide a quote at all. The insurance market is not as large as you may think. Always keep to one, two or a maximum of three brokers. Any more and the brokers will end up approaching the same insurers which could lead to “no quotes” being provided which could prevent you obtaining a more competitive quotation.
InsurersNot all insurers are the same. Although heavily regulated, some insurers operate on “passports” from outside the UK. This means they are not as secure as UK registered insurers. Several have gone out of business in recent years, unable to pay claims to clients. Brokers can advise and monitor insurers and make sure your business is kept secure. Try to keep to “A” rated insurers (rated by Standard and Poor or Moodys). Some insurers restrict cover to the UK and if your business extends outside the UK, for example, to the USA, then an insurer that provides this coverage must be selected.
Claims ServiceWhen the worst happens, you need your insurance the most. This is when it’s tested. Your broker must be on hand to advise and guide you through this process. Do you actually know what to do in the event of a major loss? Do you have a disaster recovery plan? Has your broker discussed this with you?
Areas to considerHow do you find the right broker? Check their approach to your insurances. Do they use checklists to ensure continuity and accuracy with their clients? Have they knowledge and experience of your sector? Many policies can be “tweaked” to ensure they meet the specific requirements of your business. It’s vital a broker reads the policies they recommend. No two are the same. One of the most important areas of any commercial insurance policy is business interruption. Many brokers do not fully understand how to calculate this correctly. In the event of a large loss, this will pay your loss of profit, keeping your staff paid and providing alternative premises to keep you operating. Get this wrong and your business may not recover. Your insurance is not all about the price. This will always be a factor but do not make it the only one. Your business and all the hard work that has been put into it deserves more. You would not comprise the safety or security of your staff and family. Do not compromise your insurance.
Bromwall is always available to review your existing cover or provide you with the advice and security you need. Contact us to discuss.