Archive for the ‘business insurance’ Category

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Business from home insurance

Tuesday, January 31st, 2012

For most business insurance policies, you do have to have a business trading address. Whether this is an industrial unit, an office, a warehouse, a retail premises or a serviced office, this is where the insurance policy applies.

If you work from home, then you are much more limited as to which policies are available to you. If you are looking for just some business computer equipment cover, you can usually add this to a household policy. Ten years ago the majority of home insurers would not cover this equipment unless it belonged to you in a personal capacity. Also, if you declared that part of your home was used for business purposes (including a home office) they would either not cover you or apply a loading.

In 2012 though, things have moved on, the odd laptop and smartphoen can be added, usually worldide if needed. But, you do need to phone your insruer and let them know that you will be using your home for a business purpose. What you do not want is a break in and the insurers to turn around and say that cover does not apply.

If you need more cover than just your business equipment, you need to consider a bespoke business from home insurance contract. There are a few insurers who still provide this cover and it is usually considerably cheaper than a more general commercial contract. The secret for this is to find a broker that is able to offer this type of contract, this is where businessinsure come in.

We have one mainstream UK commercial insurance that offers a bespoke business from home policy, with premiums starting from £100. It may well be that other covers will be required, this is why you need to speak to a broker about your individual demands and needs.

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Shop front glass cover under a business insurance package

Friday, January 20th, 2012

One of the basic principles we all learn about when we start our business insurance careers and/or examinations is insurable interest. You can only insure something in which, or to which, you have an insurable interest. There are reams and reams of learning and study material on this. It is often mis-interpreted though with people thinking that this means that you can only insure something you own. This is not the case though as insurable interest can apply in many, many ways. For example a mortgaged property is owned by you, but another party has a legal charge against this property. Although it is yours to sell as you wish, if you decide not to pay the mortgage, in can be repossessed because you do not have full title. The deeds are held by the mortgage company until you have paid the debt owed.

This long introduction is purely to show that insurable interest can apply to physical property that you do not own. The same applies to shop insurance. You can insure, on your shop insurance policy, parts of the building that you do not own. You will find, in the over-whelming majority of cases that you will be responsible for the shop front and the glass. If you have a full insuring and repairing lease, then you may be responsible for the buildings insurance as well. In the main though, you will need to insure the shop front glass.

Your commercial landlord will have a policy in place for the bricks and mortar, but not necessarily for the shop front glass. Shop front glass claims are numerous and you will find that the commercial building insurance policy may either not cover the glass or have a high excess. Also, if you have your own sign writing or lettering on the glass, then this is not the landlords responsibility. It is down to you to ensure that your shop policy provides you with a) adequate cover and b) a sensible excess.

By adequate cover, we mean the sum insured must be sufficient, you should either have an unlimited sum insured (which, whilst available, is rare) or a sum insured that is sufficient to replace all of the glass in the premises.

As always, if you do not have this cover speak to an independent business insurance broker. If you are through a broker and do not have this cover, change your broker!

Posted in business insurance, shop insurance, shop insurance quote | Comments Off

Unoccupied commercial building insurance – quote to cover, how long?

Thursday, January 19th, 2012

Unoccupied commercial building insurance is a type of cover that is normally available from most insurers. There are various reasons for this. Over time most insurers keep and build up huge databases of the statistics associated with all the different types of cover they provide. This means that they can work out, very accurately, for the different types of policies.

They know, for example, if they insured 500 fish and chip shops, they could expect 10-15% of the businesses to claim in the first year. They can also work out, fairly well, what the losses are likely to be and what the costs are. But, and it is another big but, dozens of years of statistics are never guaranteed to be right. Most years they are, but then we have a couple of bad winters as we did at the end of 2009 and 2010 and with the thousands upon thousands of burst pipe claims we had, the statistics are blown out of the water. Overall though, all business insurance companies can work out what they will make money on and rate accordingly.

This is why insurers, if they want to cover them, will charge higher premiums for unoccupied, or empty, buildings. Over time they suffer more losses from buildings that are empty. Therefore, they charge higher premiums and provide restricted (fire, lightning, earthquake, explosion and property owners liability) cover for these types of risks.

One downside of looking for a quote is that it may take longer, for certain insurers, to provide a quote. Some may not even quote until they have undertaken a pre-cover survey, which can take days and days. Others may need you to provide recent photographs which they will need to review before offering terms.

As ever, please always, always speak to an independent business insurance broker for a range of quotes.

Here at Businessinsure, for most types of empty (commercial, residential and mixed) buildings, with a sum insured of less then £1,000,000, we can offer terms on the same day you request them. There are of course scenarios where we cannot meet this, but overall, we aim to provide a written quote via email, on the same day you ask us to.

Posted in business insurance, unoccupied building insurance, unoccupied buildings insurance, unoccupied commercial building insurance | Comments Off

Office insurance package policies along with professional indemnity

Wednesday, January 18th, 2012

Anyone in business nowadays knows that individuals, customers and even suppliers are becoming more litigious. The law has been changed in recent years to make it easier for members of the public to pursue a claim against anyone they see fit. We have all had to see or listen to TV or Radio advertisements enticing you to take action against others. Although there has been a huge growth in the claims by individuals, we are also seeing increased activity from on business claiming against another.

One trigger for this has been the build up to the recession, the recession and it’s aftermath. When cash is tight and also king, more businesses are prone to make claims than to absorb the costs themselves. A second trigger has been the availability of legal expenses insurance. Many business insurance policies now include an element of commercial legal expenses cover as standard. It is therefore easier for businesses to pursue action, in the knowledge that they have cover in place to pay for the legal costs associated with this.

It is therefore important that you have adequate cover in force to protect you against such claims. For most office insurance policies, the legal expenses cover is included as standard. Overall limits of indemnity are usually around the £50,000 to £100,000 mark. In addition to legal expenses cover, you need to make sure that you have adequate liability insurance, both public and products liability. For most offices though, the fees or turnover are earned as a result of services that are offered. A physical product is not always provided. In these cases you need to consider, carefully, whether there is a need or requirement for professional indemnity insurance. Most of the standard package contracts will actually exclude this cover.

There are a few, and we mean few, insurers that will offer all of the covers under one contract. However, in reality it is much more competitive to get one contract for the office and one for professional indemnity. PI cover is for your professional negligence. Public and products liability operate where these is evidence of physical damage or injury. For example the computer that catches light or the person that trips over. Professional indemnity need not have evidence of a physical loss, but a financial loss. You provide advice, for a fee, and someone suffers financially if this is incorrect.

If you are worried about whether this is a requirement for your particular business, then you speak to an independent business insurance broker and get their opinion on whether this is a requirement for your business or not.

Posted in business insurance, business insurance advice, business insurance broker, office insurance, office insurance quote, professional indemnity insurance, professional indemnity insurance quote | Comments Off

Business insurance quotes – 2012 price increases

Friday, January 13th, 2012

Business insurance companies in the UK are looking to apply increases across many of their product lines. We have been running blog items this week about the reasons for increase. The first one is index linking, the second one is increases to sums insured and the third one, which is a bit more all encompassing, is rating changes.

This is the one where we, as a business insurance broker, have the most difficulty in controlling what the insurance companies do and why they do it. One years target business can suddenly turn into another years non target trade. A lot of insurers will sit around in their strategy meetings and decide that they need to gain more premium income. Rather than  look at developing their offerings on their existing range of products, they will decide to branch out into a new range of products. For example, they may decide that  one year they are going to move into the fish and chip shop insurance market. Now, there are reasons why many types of business, such as takeaways, pubs, hotels and restaurants are not targeted by every company. The reason is that unless they are priced properly, over time they will cost money.

This is why you may have a broker that gets you a decent, competitive business insurance quote one year and then offers renewal at the existing premium plus 10, 20 or 30% or worse still, even more?

This is where you, as a business owner, have a genuine reason to look around for an alternative insurance quote. We have said before that index linking at 3% is ok but any additional amounts on top of that (with the claims caveat noted below) really are things that you should be able to question.

If you have had claims in the preceding 3 years, you should really expect there to be some sort of increase. Most commercial insurance companies allow a no or low claims ratio discount. When you have a claim this is usually reduced.

If you have had a renewal offer that is just a bit too much, then why not try Businessinsure and see what we can do for you. Email or call us on 08456 024 589.

Posted in business insurance, fish and chip shop insurance | Comments Off

Reasons for business insurance premium increases – part 2

Thursday, January 12th, 2012

We blogged yesterday about business insurance renewal premium increases and the effects of index-linking. This tends to take account of, in 2012, around 2.5 to 3.0% of any renewal increase. This is the only part of a renewal premium increase that you can either take or leave. It is applied by insurers to your sums insured to ensure that, over the years, they do not become inadequate. A small percentage change, year on year, makes all the difference as time progresses.

The second potential reason for an increase in your renewal is changes to your sums insured during the policy year. Let say that you are starting a new business, for example retail, and take out a brand new shop insurance policy. Being sensible, you are going to start out the policy with as little premium as possible, the potential is that you will start with a small amount of stock and this will grow over time, assuming your business starts to grow as well. When your sums insured are likely to be inadequate, you should speak to the business insurance broker that arranged your policy to get the amounts you are covered for increased. This is standard practice across any business. We have seen many businesses going the other way in recent years. As they start to tighten their belts a little, they decide to reduce the amounts of stock they are holding, because usually this means that cash is unnecessarily tied up.

But, as the businesses start to grow and grow again, they are goign to come back and increase their sums insured. All of this means that, during any one 12 month period of insurance, you may have sums insured for contents, buildings and stock that will fluctuate. Amazingly, we stil have some customers that increase their stock during the year and then complain when the renewal premium goes up.

The problem is that whenever a sum insured is increased during the year, it is only ever charged (or should only ever be charged) on a pro-rata basis. Therefore if your policy runs from 1st Jan to 31st Dec, you should only get charged 6 months worth of premium for cover increased on, or around, the 1st July. But, when it comes to the renewal, this will include twelve months worth of premium.

Whilst the index linking of around 2.5/3%, is something you have to accept, for mid term increases you can usually agree some sort of reduction at renewal. As with all business insurance quotes, renewals and changes, you need to deal with a broker who you can access quickly and easily over the phone to discuss any alterations or changes. Then, when the renewal comes around you can speak to the same person to discuss and agree your renewal premium.

Posted in business insurance, business insurance quote, business insurance quotes, shop insurance, shop insurance quote | Comments Off

Business insurance – reason one for premium increases in 2012

Wednesday, January 11th, 2012

Commercial insurance companies offer policies in two ways. Either as a new business policy or as an annual renewal. As with most other financial services, that are annually renewable, you tend to get a better, or more competitive price when you take out a new policy. Insurers will then look to recoup their uneconomic new business pricing at each and every renewal. They will apply increases in three different ways. Today’s blog will look at the first one, index-linking.

This is an acceptable, and sensible, form of increasing premiums. There are various measures out there on the costs of replacing stock, buildings and capital equipment. Whether or not we think prices should have gone up or not over the past three or four years, the fact of the matter is that everything has increased in cost, in real terms. With the increased costs of raw materials and distribution, overall most types of asset that can be covered under a business insurance policy have increased. Usually these are split into three separate categories. Buildings, stock and business contents/equipment. Most insurers use one of the main retail price increase measures and apply different increases, on a percentage basis. For January 2012, one of the main insurers we are using are working on the following increases. Buildings, 2.99%, stock, 3.66% and contents 3.00%. Most of the insurers have very similar levels.

Policies with automatic index-linking are good, in that they take care of your sums insured to save you having to review them yourselves. Overall, the increases are around 3% per annum, even taking into account the recession. If your sum insured is inadequate (too low) then insurers may make a reduction in the settlement costs of any claim. If you insured a building with us 10 years ago for £100,000, if it had 3% per year index linking, we would be offering renewal at a sum insured of around £135,000. But, if you continued to insure at £100,000 then, in the event of a loss you may find yourself under insured by around 30%. This can have a big effect on any type of claim.

If you deal with a business insurance broker, which everyone should, then you need to speak to them about index-linking and what the insurers describe as average. We will look at this in a later blog entry.

So, if your premium has gone up this year, you should accept that approximately 3% of any increase is down to an acceptable level, if it is index-linking. You can, if you wish, ask your insurer to reduce the figure to the same as last year. It is your decision at the end of the day what amount, or sum insured, you have.

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Direct business insurance – what options are available?

Thursday, January 5th, 2012

There has been a trend in recent years for us to go direct to companies, in the hope that we cna get a better deal. However you describe middle-men, or intermediaries, or brokers or advisers, it is not always beneficial to cut them out and try and reduce the cost. Sure, there are certain products and service that you buy where you can save money by going direct, but you are doing some of the work and are taking some of the risk.

It started off with travel agents, many companies were plugging their services and saying that if you booked direct you could save money. The savings were not great and to be honest, when you have to book the flights, coach transfer, hire car and hotel separately to me, this just means there is more opportunity for things to go wrong. The old adage, you get what you pay for, applies. That is not to say that if you book a holiday you should buy from the first travel agent you speak to. You can still search around for a better deal, but it is your choice whether you get an agent to do all of the work or you want to beaver away at home setting up a slightly more complex set of arrangements which you hope and pray will all come together on the day.

The same can be said of the search for direct business insurance. Many customers will look for this as they think that the broker or intermediary is not adding much to the process. Of course this is true in some circumstances where the broker has maybe succumbed to a bit of complacency. But the question is, will you get a better deal going direct to an insurer or simply approaching a different broker? The difficulty is that more and more of the commercial insurance companies that were dealing direct five or six years ago have now stopped this. They realised that the work and cost involved in dealing direct was worse to them than dealing through the intermediary network. Many have now closed the doors to direct business.

We are a very heavily regulated industry, and the insurers need to be as careful about offering advice and the right product. Where they have a limited range of products, the consumer is not really getting a choice. The insurers realised that they coudl nto be all things to all men and as a result, many that dealt direct have now taken the step back to only accepting business through the inermediary, or broker network.

If you are looking for a business insurance quote, on a direct basis, you may find your options limited. A business insurance broker, on the other hand, will search a much wider share of the market on your behalf.

Posted in business insurance, direct business insurance | Comments Off

2012 – business insurance premiums continue to increase

Wednesday, January 4th, 2012

As a business insurance broker, we have to balance the insurers rhetoric, about premium increases, with public perception that you can always get a bargain if you look around long enough. Over the past three or four years, insurers have been hit with the perfect storm elements of reduced customer base, reduced investment income and increased costs of losses. As a result, they are looking to make up for their under-pricing over the years by putting through above inflation increases on all classes of business.

If you watch the television or read the papers or the net, you will always fund someone that advocates shopping around. Bargains are there to be had apparently. But, when you are looking at a physical product, such as a branded pair of trainers or a television, you know what you are getting. Whether you buy the product from retailer A, B or C, you will get the same thing. The differences may be in the terms of the warranty provided, but the actual product is identical.

Contrast this with a business insurance policy, and the waters get a little bit murky. What we mean by this, is that unless you purchase an identical policy from the same insurer then you are always going to get differences. We have said this before, long and hard, that this is where you need a broker. A brokers role is to act for you, the customer, and to look for the best deal available, price, cover and service wise. We have one insurer, that we no longer deal with. Their prices were good, their products were good, but their claims service was terrible. If they were not looking to repudiate a claim, they would spend way, way too long sorting the claim out. 

But what is to stop you dealing with this company on a direct basis? Nothign unfortunately. They sell the same products over the net and I fear for any customer that does not have a broker to fight their corner in the event of a loss.

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New Year, new business insurance quote.

Tuesday, January 3rd, 2012

Many years ago, it was traditional for large companies, and the business insurance companies that provided their cover, to have quarterly renewal dates. Whatever date the policy was started, the first years cover was usually extended so that the renewal date was either the 1st of January, 1st April, 1st September or the 1st October. The January and April renewal dates were where the lions share of renewal dates fell. Things have changed andrenewal dates nowadays are usually just 12 months beyond the date the policy was incepted. We can usually change dates for companies where specifically requested. This involves running the first years policy short or long so that they have a common renewal date with other policies.

We do still have a number of policies falling due on the 1st January and these are the ones that are hardest to keep as customers. However much work we can out into the renewal, early on, it is always difficult to be aware of an attacking broker getting involved. The first you normally hear if you lose a piece of business is an email when you are back at work on the 2nd or 4rd January.

It doesn’t happen often, but when it does you do tend to wonder how the customer has got a cheaper quote. We do a thorough job for all renewals andseek alternatives from around the market. We have one such renewal that we were about to lose. In 2011 their premium was around £6,000. The holding, or existing insurers were looking to get an increase in premium, even though there had been no claims in the past three years. As a result, we decided to look elsewhere and got a range of alternatives. The difficulty was, that they had a high limit of indemnity for the public liability insurance, they used blow torches when working at large shopping centres and worked at heights of up to 30 metres. We did get an alternative though at just over £5,000 which, as the terms were the same, we offered.

Now, the client cam back this morning and said they would not be renewing as they had an alternative quote at £4,500. I couldn’t believe this was right and as the client goes back many years, they agreed to send through the terms that they were looking to proceed with.

You can now see where this is going. The alternative quote, on the face of it, was offering like for like cover, with a better premium. But, having delved through the terms, conditions, warranties and excesses it is apparent that the terms are different. The third party property damage was £500 with us and £5,000 with the alternative. They could work at height, but it had to be with scaffolding towers over 5 metres, which was impracticable for the customer. With a compromise excess of £2,500 we kept the business. But, this just goes to show that you do need to look into the written quote that you receive. I tell all my existing clients that if they look long and hard enough they will always, always find a better quote, but, very, very rarely is it on like for like terms.

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