June 6, 2017

Here’s the question: Are you paying too much for the wrong cover?

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Some businesses are purchasing insurance policies for £1. Well that is quite not true,  but in some cases they should have paid that amount as some policies are almost worthless due to underinsurance. We are helping businesses like your own quickly highlight the weaknesses in their present programme structure and can provide an exclusive alternative delivered by recognised market professionals and still remain very competitive – for free. Why? According to AXA Business Insurance¹:
  • 53% of business requiring Employers’ Liability cover failed to buy it
  • 43% have no protection against accidents/damage they may be responsible for
  • 52% of business who provide advice failed to buy professional indemnity cover
  • 90% of businesses are underinsured
  Make no mistake: being underinsured or uninsured can put you out of business. We all know of comparison sites that give you the opportunity to purchase your business insurance within minutes or a broker that can provide you with a quotation over the phone, and that’s great for a quick price check. But the truth is, no two policies are exactly the same; so how do you know if you are correctly covered? If you are underinsured or have failed to arrange the right cover it could cost you millions. In the majority of cases any gaps can usually be covered for a minimal cost, so it is worth reviewing your cover regularly. Whilst it’s something you hope you’ll never have to use, there are things you should consider when buying business insurance.
Cheap insurance might be the most expensive cover you ever buy Business insurance costs. We are not suggesting you spend on stuff you don’t need. But that’s the point, if you have to claim you don’t just want paying, you need early settlement for the right insured exposures with the right insurer hand selected for your business.
Insurance brokers do what websites can’t and are cheaper We can demonstrate how buying business insurance online can be a flawed strategy. We hopped on a price comparison site to get quotes for business insurance pretending we are a customer. It was well presented and easy to use. But the reasons for ending up underinsured and uninsured soon became stark. As we completed the form we were presented with choice after choice and drop-down after drop-down. Questions asking me to classify my business and estimate the cover needed. Choices to “include this cover/don’t include this cover” one after the other. The problem was with every answer we knew the more cover we wanted the more the insurance would cost. So not only were we being asked questions hard to respond to sensibly, most clients are not qualified to answer! It’s no wonder businesses end up with the wrong cover.
You’re buying something you don’t understand There are many examples on this – we’ll choose one to illustrate. You could be a shop or work B2B. You buy insurance that classifies you as “computer retail general” or “IT consultant”. Question: if you had to install a piece of equipment would you be covered? What do you think? The answer is it’s unlikely. Policies with these business classifications will often include a clause along the lines of “…excluding all work away other than collection and delivery.” That means exactly what it says. It means you’re only covered for collection and delivery. You pick up a box and hand one back. Do anything else and you’ve no cover. Your insurance is wrong. You need a broader business description – one that includes a work-away extension.
Not all Insurance Brokers are created equal They’re not all the same. Some will transact business all in just one call. They complete everything, end-to-end, while you’re on the phone. Now, this may sound like it’s efficient and saving you time. Sound like they’ve got your best interests in mind. Problem is it means they may be force fitting your business with one of the standard policies they offer.
A professional broker will do three things. They’re all important and you should look out for them. First, they will  take the time to understand your business and the risks you face; they can’t give professional advice without that. They will come and visit you. Second, they’ll find you the right insurance to cover those risks. While you won’t know this when you buy, their reputation hangs on what happens should you claim. The right insurance will cover your claim and pay out quickly when you do. Third, they’ll do it all for a great price now and in the future. While brokers don’t themselves price the insurance the good ones will strive to give you stable premiums over the years. Why? They don’t just want your business now they want it next, the year after and so on.
Seek advice from an insurance specialist
Before purchasing your policy, or if you’re concerned about being underinsured or missing a key element of cover, speak with one of our specialists who understands your industry to make sure all of your activities are covered. If you have been with your broker and insurance company for a number of years, it is worth conducting a review. This way you can be assured they are obtaining the most competitive rates possible for your company.
Review your insurance arrangements
When purchasing insurance, comparing cover levels with your current policy can highlight any gaps in the cover.
Make sure you identify what’s excluded. Do any of the exclusions mean you’re not going to be covered for the things your business does regularly? If an alternative quote offers a substantial premium saving on your existing policy, make sure you compare it with other policies to ensure the covers offered are like-for-like. Carefully check the terms and conditions to ensure you are able to comply. Or ask us to do all this for you! Reviewing your insurance regularly can help limit the risk of being underinsured or missing key elements of cover. To help avoid this and having the correct cover in place have a review from a specialist broker like Ascend Broking Group. We can provide you with an alternative set of eyes on your present programme so you can get the right cover, for the right limits and sometimes at a better price – how good is that? 01245 449061 matt.price@ascendbroking.co.uk