Archive for September, 2009

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Commercial insurance – minimum security conditions

Wednesday, September 30th, 2009

Every business insurance policy contains certain terms, conditions and warranties.

Most of these are the same in whatever type of policy you have. Others are added depending on what type of cover you need.

For example, if you are looking for a warehouse insurance quote you will need to insure stock. Most insurance companies will include a warranty (called stillage) which says that you need to keep your stock at least 10 or 20 centimetres off the floor level through the use of pallets or shelving. If you need takeaway insurance and you carry out deep fat frying, you will have a condition applied that states how often and how thoroughly you should clean your ducting.

Most commercial combined insurance or package policies will include a standard condition about your security. This is called a minimum security condition. This will usually say that you must have certain locks on doors and if you have any accessible windows, they must have key operated window locks.

You must, without fail, read through each and every point of this condition to ensure that you comply. If you do not you could find a claim being turned down. If you have a break-in, through the main door, and a loss adjuster is appointed they may see that one of your windows does not have a key operated lock. Even if this window have nothing to do with the claim certain insurers will turn down the loss.

Thankfully, with the help of an insurance broker, this should not occur (as they will fight the case for you). However, if you choose to get online business insurance you may not have that reassurance of a broker helping you. In this case, you really should take the time to read through the wording.

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Pub insurance play areas

Wednesday, September 30th, 2009

Pubs, in particular those in the country, are likely to have an outside children’s play area. Things have moved forward from the “good” old days when a children’s play area was a sandpit in the corner of the garden.

Publicans and the licensed trade have moved on a great deal and many establishments are proud to be family friendly.

Becoming family friendly however does come with certain additional risks. These additional risks, if managed correctly, should not come to anything. Part of the management process for these risks is to make sure that your pub insurance policy is suitably endorsed to note that you may have a children’s climbing frame or play equipment.

You will find when looking for public house insurance that you will be asked if you have a children’s play area. The insurers will be looking for details as to who installed it, how old it is, is it maintained, do you have warning or “advice on how to use” signs and importantly what type of equipment it is.

There are reasons that insurers will ask this information. These reasons are to best protect the publican in the event of a claim. Whilst the vast majority of parents are purely concerned about their offspring’s safety, there are a small minority who will also worry about sticking a quick claim in, whether you are to blame or not.

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Legal advice helplines

Tuesday, September 29th, 2009

Litigation is on the increase. Businesses would normally expect to face litigation from outside customers and third parties.

However, over the past few years there has been an increase in litigation from within businesses, their staff. Now, any employer when appointing staff can never assume that this relationship (employment) can go sour. But, there are times when employers do things to employees that are not welcomed by the employee. This does not mean that an employee can complain about everything that they disagree with. Of course, business owners and it’s staff are entitled to “tell employees off”, but this has to be done in the correct way.

Some quarters may see this as an extension of the PC gone made disease that is affecting UK plc. Others, quite rightly see this as a positive step (allowing employees to air their grievances) to protect abuse of employees.

In the middle are the employees that will not be happy whatever you say and do. If you have an employee that you are looking to discuss performance with, reprimand, suspend or some other process that could result in a grievance, our advice is to step back for just half an hour.

Think very carefully what an outside person, who is slightly more supportive of an employees position, may view what you are about to do? If you have any doubt that what you are doing may result in a grievance or worse, you should check your business insurance or office insurance policy.

Commercial legal expenses is a separate thing, if you refer to your policy, you may find that there is a free, or local rate, business advice helpline. These helplines are usually staffed by qualified or semi-qualified legal experts. There is nothing to stop you giving them a call, explaining the situation, and receiving their advice.

You may of course choose to ignore their advice, which will be wrong, but following their advice could save you money and more importantly management time not wasted in the future.

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Employers liability – do I need to display my certificate?

Tuesday, September 29th, 2009

Where a business is required through legislation to have employers liability insurance, they must arrange cover at a minimum limit of indemnity of £5,0000,000. UK based commercial insurance companies, when providing a business insurance quote in writing, will confirm the limit of indemnity.

If the business chooses to accept the quote, they will receive three things. A policy wording, a schedule of insurance (to be read in conjunction with the wording) and an employers liability certificate.

The EL certificate contains an agreed form of words and is usually on an A4 sheet, although this can be condensed to A% although this is less popular with insurers nowadays.

Legislation used to state that at every business location a valid certificate had to be displayed.

Last October, 2008, the rules were changed to say that if a company chose, they did not need to display the certificate as long as it was available electronically for all staff to see if required.

Electronically meant that it could be seen at any time on a company intranet (for example). It does not mean that once a year you can email a pdf of the certificate.

Whilst this is an answer to the modern age, businesses can still choose the traditional method of displaying the certificates for all to see.

The other benefit of displaying the certificate is that you are always aware of when your annual policy expires so you can be well prepared to look around for an alternative quote prior to renewal.

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Business insurance renewal due?

Monday, September 28th, 2009

If you have just received your business insurance renewal or indeed are looking around for a business insurance quote, you may notice a couple of things.

The first, and main one, is that most UK commercial insurance companies are looking to increase their premiums. This may be under the guise of “index-linking” but at the end of the day, they want to increase the premiums they get in.

The second, and smaller point is that many insurers are starting to restrict cover for flood. Whilst this is a small point, it can have a devastating affect on your business.

If you have received an increased premium at renewal, the first step is not to search around for alternatives. You should have a relationship with your insurance broker and we would suggest calling them up first and simply asking why the increase. There could be a valid reason and if so, your broker will explain it.

If their reason is “xyz insurer are increasing their premiums this year” then go get the alternatives. If XYZ are increasing then the broker should get alternatives from ABC, DEF and GHI as well. Their job is to get you the best deal, not only at new business stage but at every renewal after.

If you have a flood exclusion applied, then unless you are at the top of a hill you should insist that your broker looks around for an alternative. Insurers flood mapping is notoriously “broad brush” and does not drill down into enough depth at postcode level.

Whilst you insurer may not be happy to take on the flood risk, another insurer may be prepared to do this with just a nominal excess increase.

The answers are all about looking around, you don’t need to spend too long as there will be an insurer that is prepared to do you a deal.

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Letting your house – who will insure you?

Monday, September 28th, 2009

No-one can, or will, forget the past two years financial crisis around the world.

Here in the UK we appear to have suffered worse than many other countries in the developed world. The New Labour government (is is that now Old) is partly to blame for us being so badly in the mire. Of course Gordon Brown will not admit it, but most of the consumer growth in the past 15 years has been fuelled by a housing boom. Now we have reached the inevitable bust stage, which we were always promised would not occur again.

This has caused huge problems for the average UK householder. Whilst some areas of the press have said that people are looking for unrealistic prices when selling properties, there is usually a good reason for this.

So, people are trying to sell their residential property and not being able to sell. As a result we have a huge growing number of accidental landlords who cannot sell their properties and are therefore having to rent them out.

If you are in this position you need to be careful that you do not rely on your normal house insurance to cover you. If your home insurer knows that you are letting your property (after a claim) then your policy will become null and void and you will receive no benefit.

You need to arrange a specialist landlord insurance or commercial building cover. Commercial insurance is used because you are receiving money for letting, so technically this is a business venture.

Thankfully, getting this cover (also known as buy to let insurance) is easy and many reputable companies offer policies via the internet.

Be prepared to pay 40/50% more than your domestic policy (buildings only) and up tot 75% more if you are looking for contents cover. You will also need to shoulder a higher excess. Household insurance excesses are typically £50, for commercial building insurance policies the excesses are usually £250, although you can search around to get them as low as £100, but be prepared to pay a little more.

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Takeaway Insurance – correct money cover

Saturday, September 26th, 2009

Takeaway and fish and chip shop owners need to check the adequacy of the money cover they have in place.

It goes without question that takeaway insurance is a must to protect the business assets and employees. However, takeaway and fish and chip shop insurance premiums and policies vary a great deal. Part of the reasons that they vary is due to the level of cover.

Using the analogy of a car, if you want a metal box with four wheels and an engine, you can pay anything from a few thousand to a few hundred thousand pounds. The difference of course is the quality.

You need to take care when looking for your takeaway insurance quote that you have cash on the premises cover overnight. Most takeaways will close late and may not be able to take the cash to the bank night safe.

You will need to make sure that you have cash on the premises at the maximum available, without paying extra. A limit of £500 is the usual maximum that insurers would offer without the cash being in a safe.

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Shop insurance – walk in/walk out theft cover

Friday, September 25th, 2009

Every shop-keeper has unfortunately had to suffer the pains of shoplifting to some degree or another.

Whilst we are not saying it is acceptable, it is something that does happen all too regularly. Shops are designed to entice customers in to touch, feel, sample, try on etc all of their stocks. The ultimate aim of course being that people will purchase the products.

Shoplifting is theft as defined by The Theft Act 1968 with all it’s revisions. All shop insurance policies will include theft cover, if they don’t it is time to change your policy.

However, insurers do not want to cover shop-lifting and have a restriction on the policy relating to theft. This states that theft losses must be as a result of forcible and violent entry to or exit from the premises only. Therefore shoplifting, or indeed theft by staff, is excluded.

There are no commercial insurance companies that will give this cover as when issuing a shop insurance quote or policy to you.

But, a few strategically placed signs and CCTV cameras will be beneficial in helping to prevent these sorts of losses. CCTV camera systems are much cheaper these days and you can even install a fairly good quality one that records onto DVD’s, or even to a remote server, quite easily.

Whilst we are not saying staff cannot be trusted, it is always worth paying the extra few pounds for a camera to cover your stock room as well.

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Commercial insurance – trade all risks cover

Friday, September 25th, 2009

When looking around for a commercial insurance quote, you need to be careful to consider not only the basic cover (which is usually automatically included) but additionally the optional sections.

If you have tried one of the websites that offer to compare business insurance quotes then you may find that the “competitive” price they have quoted is only competitive because the cover has been pared down so much.

One area of business insurance cover that can be missed out is cover for business equipment whilst out and about.

The percentages of businesses that do not own a laptop or notebook is very small. The good thing is that laptops are much cheaper nowadays, a decent business entry level laptop can be bought for around £400.

But, if the laptop is stolen or damaged away from the business premises it is unlikely to be covered unless you have this specified on your insurance cover.

You can usually extend the cover to EU and/or Worldwide at relatively minimal cost. Cover will be restricted from unattended vehicles overnight and any theft losses tend to be subject to forcible and/or violent entry or exit.

If you cannot see that you have this cover, speak to your broker or insurer to add this. A £500 laptop anywhere UK for the year should only add £10/15 to your premium.

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EU distance selling directive – how this relates to commercial insurance

Thursday, September 24th, 2009

Whilst we may bemoan the EU at times, there has been some regulation that has been beneficial to residents.

One of these is the distance selling directive. What this means is that any consumer of a product or a service, is entitled to cancel that service or return that product (at the consumers cost) and negate the contract.

When looking for a commercial insurance quote, this is something that should be made clear. For example, if you receive a commercial liability insurance quote and are happy with this, you may then go ahead and buy the insurance. If you are dealing over the net or the phone, you are buying this contract of insurance “at a distance”. Therefore you are covered by the legislation, even if you are quoted a premium of thousands of pounds and you choose to pay this up front, then you are entitled to a full refund.

You are not allowed to be penalised by any significant admin charges or minimum premium amounts. You may have to pay a small £20/£20 administration charge, but going back to your commercial insurance quote, this should be made clear in the documentation.

You must act within 14 days and put a request in writing (email is acceptable if you ask for a “read receipt”) to cancel the insurance. Beware though that you have no cover whatsoever and if you are without cover for any time, you do leave yourself open for a future liability insurance claim.

You would only tend to make use of this if you have been sold an unsuitable product. For example, when you get your full office insurance documents you may realise that there are onerous conditions which were not pointed out at inception. If this is the case you may choose to take out another contract with a different insurer and look for the premium to be refunded to you.

If you do choose to cancel and your broker tries to take a “fee” then do a bit of googling on distance selling directive and insurance. You should find yourself enough evidence, fairly quickly.

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