May « 2011 « BusinessInsure Blog

Archive for May, 2011

Cancellation rights in relation to Business Insurance

Tuesday, May 31st, 2011

As a business insurance broker, we do have a detailed knowledge of all aspects of cover. We try to help anyone that phones us up, even when the chances of getting some business out of the call are very slim. We were open yesterday on the Bank Holiday and I received an interesting call from someone just looking for some advice.

This customer, Miss A, had just started a new venture and had received a salon insurance quote from a recommended broker. As everything was a bit of a mad rush to hit her start date, she hadn’t really had a chance to look around for any alternatives. After the initial start date had passed and the business had opened without a hitch, she was sitting down to review some of her paper work.

The reason being that she had just received the invoice for her insurance and one of her members of staff who was going to send the cheque, commented that it seemed a bit high compared to her last job. So, Miss A had asked us just for an idea of the costs. She gave me brief details and, based on what she had told me I knew that we would have at least three different insurers who would quote around the £400 mark, possibly less if we referred it back to the insurers.

Her quote, believe it or not, was £795.00, which was way over the top. She had proceeded with the cover, but I explained to her that, under the EU distance selling directive, she had 14 days to cancel the policy, at no charge whatsoever. She said that her brokers were closed on the Bank Holiday, but she would give them a call today as her 14 days are up on the 1st June.

If they play ball, then they should cancel the insurance cover, ab initio, or in plain English, from inception. But and it is a big but, you have to be careful because you are not getting 14 days cover for nothing. What you are getting is no days cover for nothing. Potentially you could be faced with a liability claim in months to come and, because you had no cover, you could be faced with a large bill.

The best thing the customer can do, is to try and get the current provider to reduce the premium, on the basis that the market price is a lot less than £795. Our recommendation was not for her to cancel the policy, she may just have to bite the bullet and accepted that she was over quoted for the first year and put it down to experience.

If you get a chance, always look around for an alternative.

Posted in business insurance broker, salon insurance | Comments Off

Spam comments – do they really work?

Saturday, May 28th, 2011

We have been trading as a business insurance broker for nearly 11 years now. We are part of a larger group who have been trading for over 50 years. As a result we have unrivalled knowledge of all things relating to commercial insurance. We try, through or blog, to part with this knowledge and genuinely try and help customers, potential customers or others just looking for advice.

If you are a regular reader, you will know that the topics can be wide-ranging, sometimes bizarre but all the time aimed at provided that one piece of advice or help that is required.

We have learned our lesson though, as far as allowing comments is concerned. When we moved to Wordpress from Blogger, we allowed comments for the first couple of months. We thought, extremely naively, at the time that we would be able to interact, shoot the breeze or just help some people that were stuck with general insurance questions.

We thought that spam comments were no longer used. But how wrong we were. Every blog post that we did had, at times, dozens of spam comments. There was nothing scientific or clever about them, they were just filled with random words and if there were phrases, then it was obviously from someone using very, very poor translation software.

So, in early 2010 we deliberately set the default to block comments. It was with sadness in a way because if people did need help then they were not going to get it from correspondence on our blog. As people can call us, local rate, then it was agreed that having this option was probably better. We offer on our site that we will give commercial insurance advice, for free and we do still find people calling us to check something or just get an honest answer.

But, we are stil getting over a hundred spam comments a day on blog posts over a year old. How can this be beneficial to these people? There must be a financial reason for doing this, as there is a financial cost to send out these comments. I just cannot understand how the big search engines cannot tell that these crap comments are there for one reason and one reason alone.

I know that the spammers like to try and keep one step ahead, but it really is frustrating to have physically delete thousands upon thousands of comments every month. Maybe as time goes on things will get a bit better.

Posted in business insurance, business insurance advice, business insurance broker, business insurance quotes, commercial insurance | No Comments »

Commercial property insurance – indicative rates

Thursday, May 26th, 2011

When looking for physical products, such as cars, houses, consumer electronics and clothing, to name but a few, you will always have a rough idea of what is reasonable and what is expensive. You are therefore able to understand what is and what is not a bargain, based on your past experience.

If you are looking for commercial property insurance, for the first time, how do you know what is a good, expensive or cheap price? In addition, if it is cheap, compared to others, then how do you know it is going to give you what you want in terms of cover?

Unlike your house, when you get cover for a commercial building, this is based on three things (in the main), the cost to rebuild the property, where it is and how it is occupied. There are of course other factors, such as construction, cover required, your claims experience and many more which affect the price charged, but the main three account for at least 60-70% of the premium cost.

So how do you know what is reasonable or not? The first thing you really need to nail down is the cost to rebuild, don’t guess the figure as this could cause problems later. Refer to either the company that have financed the mortgage (if applicable) or speak to a local surveyor. Make sure you approach three or four surveyors, you would be surprised at the difference in cost for what is essentially a simple measuring (of the floor area) exercise. Surveyors are having a tough time as well, you should be able to get a re-instatement only report for a few hundred pounds.

Once you have this figure, you then need to apply a percentage rate to the total figure. Any business insurance broker worth their salt should be able to give you a rough idea. For better risks (as far as insurers are concerned) such as shops, offices and salons, the rate will be around 0.20%. This will increase, depending on the factors mentioned above. For a fish and chip shop (higher fire risk) the rate could be up to 0.40%. Speak to a broker to get an idea, you can then at least compare this to your existing deal.

Posted in business insurance, business insurance broker, commercial property insurance | Comments Off

Business insurance and the once in a blue moon claims

Wednesday, May 25th, 2011

Having lived in South East England through the Great Storm of 1987 and the not so great, but still very bad, storm of 1990 it has been a long time since we have seen devastation on that scale. I know we have global warming rammed down our throats as the cause of every non-seasonal weather event, but the fact that they were over 20 years ago and we have not seen events on the same scale since, must mean something.

I am not a meteorologist, but the fact that they were so close, relatively, and have not happened since, to me, means that sometimes the weather is just bad and some times lots of things combine and we start to see property damaged on a serious scale. In Scotland, on Monday 23rd May we had very strong winds, property wasn’t damaged so much, the big problem was the trees and branches falling.

Our office is next to a big parkland and at least one in every 5 trees has fallen over, some of them are big, big trees. Our blogs are normally filled with a check your business insurance policy type comment. Today’s is, to ensure that firstly you have cover for falling trees as they can easily destroy a building, or if you do no insure the building, your contents inside. Secondly, you need to check that you have a reasonable excess.

Given the past few bad winters, some insurers are starting to creep up their excesses from the usual £250 to £500 for storm damage. If you deal through a business insurance broker, which is really the only way you should arrange your cover, today may be just the time to call them to check your policy cover. Do not leave it until renewal, you have a policy for 365 days, so you can speak to them whenever you want.

Posted in business insurance, business insurance broker | Comments Off

Legal advice – it's better to get it free

Tuesday, May 24th, 2011

When we look back over the past few days, as far as privacy laws are concerned, the two names that will be mentioned for ever are Imogen Thomas and Ryan Giggs.

Anyone with access to the internet knew, if they were interested, that the football player with the injunction, was Ryan Giggs. We have just heard that the reasons for the injunction were, primarily, that he would be picked on or booed by opposing fans. Not that anyone has any shred of respect for Giggs, but if the reason for the injunction had been solely for the privacy of his wife, kids and ex-mistress, then some may have been swayed.

It is really about ego and future earning potential. As a Chelsea fan, it is of course good to see the club doing well, but the flip side of the coin is that we have an owner that, through sheer wealth, can basically do what he likes. He does not give interviews and I am sure that in his inner circle they are sycophantic enough not to say to him that maybe, just maybe, there is a better way of managing situations. But he does not care about what people think or how much it costs, because he has so much money. It doesn’t bother me, but it is a great thing for opposing fans to boo Chelsea about.

Giggs is only worried about one thing, his future after football. I am sure he wanted to either go into management or become a football pundit. He sought legal advice, possibly on the recommendation of his club, and it was wrong.

Having been through a tribunal process ourselves, we know how easy it is to rack up the bills. The estimates of £100,000 are, in my opinion probably way short of what he has actually paid. And the thing is, that at every step of process his legal advisers would have told him that he had no chance of guaranteeing success. He has, partly through arrogance and partly through believing he could use the law to his advantage, affected the course of the rest of his life.

Now, how does this affect business insurance? To have a claim made against you, as far as liability insurance is concerned, someone has to prove that you have been negligent. In a nutshell, if the negligence cannot be proven, there is no claim. But, this does not stop claims being made and this is where you need access to legal advice, that is quick, easy and free. Many policies include a legal advice helpline. Where this is the case, as soon as you are aware of anything which may give rise to a claim, you should either speak to your broker or refer to your policy wording to see if there is a claims line or a legal advice helpline.

Posted in business insurance, liability insurance | Comments Off

Legal advice – it’s better to get it free

Tuesday, May 24th, 2011

When we look back over the past few days, as far as privacy laws are concerned, the two names that will be mentioned for ever are Imogen Thomas and Ryan Giggs.

Posted in business insurance, liability insurance | Comments Off

Business insurance renewal – how many quotes should you get?

Monday, May 23rd, 2011

Business insurance, is one of the few annually contracted services that you can buy, where there is no real commitment to renew. Think to other services that you may get such as electricity or mobile phones and it appears that it easier to get divorced then get out of one of their contracts.

Having said this, your insurers will, if your business has been profitable and is still on their preferred trade list, offer to renew your cover, in the hope of retaining your business for a further 12 months. The good thing is, that you are under no obligation whatsoever to renew. Most of the commercial insurance companies are, or have been, guilty of operating a dual pricing philosophy. They tempt you in with ultra competitive prices and then, when renewal comes around they put on an above inflation increase. If they can do this for a few years, then they can make themselves a pretty penny.

If you think about it, if they undercut your premium by 10% to get you as a customer and then add in two, three or four percent per year above inflation, then it does not take long for them to be charging too much.

So to go back to the original question, at the start, how many alternative quotes should you get at renewal? The answer is, a little bit tongue in cheek, always more than one.

If your existing insurer is not applying a significant increase, ie in line with inflation-ish, then you should seek at least one alternative just to check that they are relatively competitive. You never know how the market has changed in the past 12 months, it may be that prices have dropped across the board. So what was competitive a year ago may now not be quite so cheap.

If however your existing insurer is applying a big increase and your broker has not thought to offer or seek any alternatives, then you need to get at least two alternatives. Speak to another broker and tell them everything about your policy, your business and the risks it presents. If they ask you for the premium, tell them, but make sure it is true. The chances are, in 2011, with the market still being fairly competitive, that if yours is the type of insurance business that they (the insurers) seek, then you will be able to get a better price.

Our words of warning though are that if you do get alternatives, please make sure that you get these from an independent business insurance broker. This way you can be assured that not only will the broker sell it to you on price, they will also make sure that you get a the right cover. There is no point in proceeding with an alternative quote at 10% less, if the cover and excesses are poor.

Posted in business insurance broker, business insurance renewal quote, commercial insurance | Comments Off

Unoccupied property insurance – cover available

Friday, May 20th, 2011

As far as commercial properties are concerned, if you are looking for cover when they are empty you tend to find insurers are very selective in the cover they offer.

If you approach any commercial insurance company, with a property that is let and is claims free, you will be able to get the full list of covers. This will include fire, lightning, earthquake, aircraft, explosion, impact, theft, flood, burst pipes, malicious damage, accidental damage and cover for windows and sanitary ware. In addition to these covers you can also get subsidence, heave, landslip, property owners liability, loss of rental income and legal expenses.

If you then tell them that you are looking for unoccupied property insurance, following the sharp intake of breath, they will, if they are prepared to offer a quote, give one that is very restricted in the cover they offer. Instead of the whole range of perils, or events, they will usually only provide cover for fire, lightning, explosion and aircraft. This is commonly referred to as FLEA cover. The only other cover you will normally get is property owners liability.

Whys is this the case? Insurers base their pricing, cover, terms, excesses and warranties on their past experience. Whether or not you think that the risks presented by your building are low, the insurers do not always agree. They perceive all risks as having the potential of a loss, otherwise why would you be looking to insure?

Empty buildings tend to attract thieves, vandals and arsonists. In addition they tend to suffer increased losses from the weather. Some insurers are happier to offer wider cover than the restricted FLEA. What you need to do is to get an independent business insurance broker to look around all of the available insurers for you.

If you are told that you can only get the restricted cover, this is more than likely to be wrong. The right broker going to the right insurers will get you the cover you want.

Posted in business insurance broker, unoccupied property insurance | Comments Off

Marine cargo insurance – who is responsible?

Thursday, May 19th, 2011

Although the world is looking to reduce it’s carbon footprint, the transport of goods around the globe continues to contribute a great deal to the footprint for products we buy.

This is likely to continue for many years to come, until one of two things happen. The first, is that more and more countries get tougher on reducing emissions, or secondly, the unthinkable (to some, not all) that maybe the whole humankind caused global warming will not be as bad as at first thought, because maybe it is just a natural phenomena. Until this happens, we will continue to move goods around the globe. This will also mean that the need for marine cargo insurance will be around for a very long time.

You tend to find there are two types of companies that ask for quotes, those that are involved in this all the time, including freight forwarders and couriers and the others are businesses who have just started to grow and receive orders from overseas customers.

If you are supplying goods, then exactly who has responsibility and more importantly, what cover do you get. If you move goods with an approved carrier, in most cases they will offer some form of cargo insurance. Depending on the nature of the goods they are carrying for you, this will either be adequate or inadequate.

The potential for it to be inadequate, will be where the cover they offer you (and charge you for) is limited to a certain amount per kilo. If you are moving aggregate, all well and good, if you are moving consumer electronics, not so good.

The best option for you, if you are looking for this cover for the first time, is to speak to an independent business insurance broker. A broker will not charge you for advice and they will usually be able to provide you with two types of quotes, either a one off consignment or an annual policy. Depending on the amount of business you will or may do, the annual policy could turn out to be the most competitive option.

Posted in business insurance broker, marine cargo insurance | Comments Off

Business insurance – employees personal effects cover

Tuesday, May 17th, 2011

If you have ever been on holiday and claimed under your travel policy for something physical (ie loss of camera) you may have been referred back to your house insurance company. Under many house policies, you have temporary removal cover for your contents, away from the home, for up to 30, 60 or 90 days, for example. Some, not all, of the travel underwriters therefore refer you back to your household insurers. This is a bit of a swizz really because you really want to just have one policy to rely on.

The same thing can happen under a business insurance policy. We have two claims on the go at the moment, from different insurers for exactly the same thing. Two business premises suffered a break in, an office and an engineering firm. During the theft, personal effects of employees where stolen. Both policies contained a definition of contents and this included employees personal effects up to a limit of £500 per person, which is reasonable enough. So far, so good.

Also, as with all policies, there is a clause which essentially says you cannot be doubly insured. For example, if there is another policy in force this may be relied on instead of the main policy. Now, strictly this very rarely comes into force.

One of the companies, with an office insurance policy, are more than happy to settle the personal effects portion of the claim. The other company are being a bit more difficult. They are saying that they want the employee to pursue the claim with their household company.

We are not happy about this, particularly as it is only for a few hundred pounds out of a claim in excess of £12,000. We should get a response in the next day or so and needless to say, depending on what the response is, we may decide not to use that insurer again.

When your next business insurance renewal comes around, make a point of checking this with your broker. Believe me, this is one way to have an unhappy employee.

Posted in business insurance, personal effects insurance | No Comments »