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UnderinsuranceSmall and medium sized businesses need commercial insurance to cover their premises, contents, machinery and equipment. If you are sourcing your business insurance online and your only consideration is to minimise the cost of the premium, you may find that your insurance cover leaves you out of pocket if you need to make a claim.

Underinsurance is a common problem. 40% of businesses do not have enough business interruption cover to get them back on their feet (Building Cost Information Service 2012).

Rebuilding costs
The sum insured should take account of the actual rebuilding costs, not the market value. Depending on the type of property, reinstating the building back to a useable position following an incident may cost more than you think once you include materials, labour and professional fees, not to mention loss of earnings during the rebuilding period. In 25% of SME claims reviewed by the FCA, the indemnity period expired before they returned to a normal trading position (FCA thematic review of SME claims TR15/6 2015).

Business interruption insurance
The consequences of an insured incident could result in reduced or complete loss of income from your business for an unknown period. It is therefore important to check how long the indemnity period is on your insurance policy. Two years is likely to be needed for a business to fully recover to its original trading level.
These calculations can be complicated, considering all of the eventualities that could delay getting your business back up and running; for example, delays in planning permissions when rebuilding, long lead times for replacing stock or machinery and replacing customers lost due to downtime.

This is where a broker can offer their expert advice. Depending on your business circumstances they may suggest a declaration-linked, non-average basis of insurance, because it provides an uplift of 33% providing that the sum insured is correct initially and declarations are made when requested by insurers. Alternatively, a policy that is based on the estimated amount of gross-profit or revenue that you expect to earn.

Legal liability claim
Claims against your business can come from a variety of risks and insurance is designed to provide adequate levels of cover of usually £5 to £10 million. The types of cover to consider include:

  • Employers liability
  • Public and products liability
  • Directors and officers liability
  • Cyber threats
  • Environmental liability
  • Professional indemnity

You will have to assess the risk levels within your own business to determine whether the level of cover is going to be enough for your individual circumstances.

Benefits of using an insurance broker
Insurance is complex and it is not easy to assess all of the risks associated with your business and to select the most suitable insurance policy to meet your needs. Get it wrong and you could jeopardise the future of your business.

An insurance broker will be able to offer advice and select the most suitable policy for your business. They can arrange accurate valuations to ensure you have exactly the right amount of cover in place when you need it.

Retail_high_streetThe wonders of the 24 hour digital store front and instant online payment systems  has changed the face of UK retailing; and delivering goods direct to customers has never been easier – right?

A new report shows that the rush for retailers to offer online shopping and home delivery is actually adding pressure and putting some businesses at risk.  However offering a “Click and Collect” service is becoming a popular way for high street stores to grow their business and bring shoppers back.

JDA’s Customer Pulse Report 2014 surveyed 3,139 UK consumers aged between 16 and 64.  The survey found that one in five customers have experienced problems with online home deliveries and 61% say they would switch retailer because of an unacceptable online experience. Late deliveries, imprecise or missed delivery slots, poor tracking and of course damaged goods were on the list of complaints.

Though much of this can be due to the third parties used for deliveries, 84% of those surveyed said the retailer is still accountable. This could well influence a move towards “Click and Collect”; offering online shopping but necessitating a visit to shop premises. Retailers large and small are developing Click-and-collect services in an attempt to reduce fulfilment costs, improve service and offer greater convenience.

Brandon Lewis, the government minister with responsibility for high streets, believes “click and collect” is the way for independent smaller retainers to drive traffic back to the store. He believes that ideas such as apps that promote “high street only offers” will give people more reason to go into town.

Retailers considering new digital store fronts and joining online vouchers schemes should approach with caution though. Diversification and changing your business operations can impact on your insurance. In the battle to stay competitive and find an “edge” that brings new revenue, many retailers fail to keep their insurance up to date. This can leave them paying too much for cover they don’t need, or being under-insured, or worse still uninsured when facing a setback.

Independent local brokers like us work in partnership with clients to seek out the best policies, with the right level of cover. We are flexible and adaptable, to ensure that your insurance fits your individual needs now, and as your business evolves. And when you do need to make a claim – unlike a faceless call centre – we are on hand and eager to obtain settlements as quickly as humanly possible.
Shop_retail_insuranceHeadlines like “Ghost Town UK”, “Retailers Closing 14 Shops a Day” and “Consumers Cut Back Spending” do not make happy reading for embattled shop owners.

Though the British Retail Consortium (BRC) has reported that shop closure rates in some areas are beginning to slow down, in other parts of the UK they remain stubbornly high. Yet at a time when retailers should be protecting themselves in every way possible, concern is being expressed that the opposite is true.

It could be that tight margins and days spent fire fighting are causing retailers to cut corners on something that could one day prove to be a vital lifeline – adequate insurance. There are so many risks and threats to a shop’s ability to do business effectively that insurance cover shaped to each shop’s specific business needs has never been more important. Yet hundreds leave this cover to chance by obtaining packaged policies online or direct, which may leave fatal gaps.

As each shop is different retailers are being urged to talk to local independent brokers like us. We can work with you to create a clearer picture of what insurance products your business needs, then research the best policies, the correct levels and limits, at the best possible premiums. Our understanding of the retail sector – and your location – means we can be thorough in advising you on appropriate cover and progress claims personally.
It is an ever-changing world for retailers. Consumers and the buying decisions they make are evolving fast.

Retailers are fighting to attract and retain customers, using every penny in the business to trade profitably. What retailers do not want is the distraction of dealing with damage to property, goods, equipment, vehicles, reputation or supply chains. The right insurance can shield you.

We can also look at Employers and Public Liability insurance; your protection against non-compliance with legislation or that irate employee or customer who decides to take you to court. Statistics suggest that as sales rise, so does the incident of shopper injury, which these days can lead to disastrous law suits.

We can also look at any extra covers you might need, like Professional Indemnity if you are providing advice or expertise, or cover for loss of licence if you sell alcohol. There are so many insurance products available, guidance on finding the right ones can avoid paying for cover you don’t need, or costly mistakes by being underinsured.

The true test of your insurance cover comes when you make a claim. And that’s when the support of a local broker like us could also be invaluable.  We can help you avoid interruption to your business by progressing claims as speedily as possible. You won’t have to worry about faceless call centres, and long drawn out haggling. Not least, as by doing our homework, we get your business covered properly, making claims a great deal more likely to succeed.