Is your business adequately Insured?

Business Insurance is a critical consideration for any business owner or manager, offering an effective means of protecting your assets, covering you and your business against potential liabilities and enabling your future growth. Despite this, insurance is often not given the time and care that it should. In a 2023 survey*, 41% of small businesses in Australia admitted that insurance was the last thing they consider when it comes to making changes to their business, resulting in a huge exposure to under insurance or gaps in coverage.

One important way to avoid any potential coverage issues when it comes to making a claim is to stay on top of your insurance arrangements and to have a system in place for regular review.

Here are 4 steps to better insurance outcomes (and greater peace of mind)

1. Regularly review your Risks
Regularly review your business operations and assets to determine whether your current insurance policies are still appropriate for your business and for what you want to insure. One of the easiest ways to ensure you do this is to use your annual renewal reminder as a prompt.

Regular valuations can help ensure you are adequately insured for property loss or damage. Also, consider what your business relies on to generate revenue (e.g. physical assets, IT systems, etc) and how long it would take to get back up and running if you had a major claim. You can insure against loss of income.

Lastly, consider the risks your business operations might pose to your clients and other third parties (your liability risks). Your team at Praden can help you with this.

2. Stay on top of your changes
Your insurance program is based on the information you provided when you put the various policies in place. Your annual renewal is an opportunity to raise any business changes so that, as your insurance adviser, we can advise you of whether there are any insurance matters that should be addressed.

There are some events (material changes) that have immediate insurance coverage implications. Examples include:

• Acquisitions or Divestments
• New Vehicles
• Expansion into new territories (e.g. starting to export overseas)
• New product or service offerings
• Entry into joint ventures
• Threats of an imminent claim

… and the list goes on!

These changes should be disclosed as soon as you become aware of them. If you’re not sure whether a change is material to your insurance policies, just ask!

3. Understand your policies
All insurance policies contain conditions you must comply with to ensure the policy will respond in the event of a claim. Some of the more common conditions are the obligation to promptly notify claims (or circumstances that might result in a future claim) to insurers, the obligation to not admit liability to third parties and the obligation to declare any material business or risk changes to insurers as soon as they become known.
If you’re unclear on any of your insurance coverages or obligations, it is important to raise any questions. As your insurance adviser, we can explain these to you in plain English so that you know what you are and are not insured for, as well as what you need to do to stay covered.

4. Get Expert advice
You understand your business better than anyone and are best placed to describe it to others. By partnering with the team at Praden, you benefit from the experience and expertise we have in ensuring that any insurance you purchase is fit-for-purpose, with your business needs and objectives in mind.

If you’d like to revisit your current insurance arrangements, or discuss any additional requirements you might have, please do not hesitate to contact us. If you don’t have your regular adviser’s contact details handy, you can contact us.

This communication is for general information purposes only and does not take into account any specific individual’s or business’s objectives, financial situation or needs. Before acting on any of the information provided herein, you should consider how it applies to your specific circumstances and contact an insurance broker and / or other appropriately qualified professional to discuss. Any advice given on what is or is not covered under any specific insurance policies is general only. You should always refer to the relevant PDS and policy wording to determine whether the coverage is appropriate for your individual circumstances.

Author: Sophie Cooke

References:

The Vero SME Insurance Index 2023  https://www.suncorpgroup.com.au/uploads/2023-Vero-SME-Insurance-Index-Report.pdf

Please contact one of our advisers if you would like further information on this article.