Are your details correct?
The importance of reviewing what your Insurance Broker knows about your business at renewal
Year on year, you will get a call, email or have a meeting with your insurance broker to go over your insurance renewal. You will be asked to notify them of any changes to your business or it’s operations – but when was the last time you reviewed in detail what they had on file about your business?
Not reviewing and updating details about your business can be disastrous. From not being covered, to paying for cover you don’t need, and worst case – a claim being denied because you didn’t provide accurate and up to date details. Taking a few minutes to review what your broker has on file is just as important as having insurance in the first place.
Reviewing ‘’What You Told Us’
Here’s why it’s essential to update key details with your broker at renewal time:
Annual Turnover
Why It Matters:
Your business’s annual turnover plays a significant role in determining your insurance premium. If your turnover has increased or decreased since your last renewal, it could affect the amount of coverage you need and the cost of your policy.
Example:
Imagine your business experienced a 30% increase in turnover last year. If this change isn’t reported to your broker, your current policy may not cover the full extent of your operations, leaving you underinsured. If you were to have a claim – it may be denied or the settlement may be significantly less than the loss your business has experienced. On the flip side, if your turnover has decreased, you could be overpaying for coverage you no longer need.
Employing Subcontractors or Contractors
Why It Matters:
The employment of subcontractors or contractors, and the amount you pay them annually, can significantly impact your insurance requirements. These workers are often involved in high-risk tasks, which can increase your liability. Many trade services businesses, like builders, carpenters, landscapers and excavation businesses, use subcontractors making this an important consideration.
Example:
Suppose you started employing a team of subcontractors to handle a specific project, and their annual pay exceeds your previous estimates. Failing to update this with your broker could result in inadequate liability coverage, exposing your business to greater risk in the event of a claim.
Machinery, Equipment, or Vehicle Changes
Why It Matters:
If you have general property or insurance for your premises or commercial motor and/or Fleet Insurance, any addition or disposal of machinery, equipment, or vehicles need be advised to ensure they are accurately reflected in your policy. New purchases might need coverage, while sold items should be removed to avoid paying unnecessary premiums.
Example:
If you’ve purchased a new piece of expensive machinery or upgraded your company vehicles, these assets need to be added to your policy. If you’ve sold or retired equipment, updating your broker can help lower your premium by removing unneeded coverage.
Premises Renovations or Extensions
Why It Matters:
Changes to your premises, such as renovations or extensions, can alter the value of your property and the risks associated with it. Not reporting these changes could leave you underinsured or improperly covered. Remember that the sum insured you have given your broker to replace the building is the max figure your claim can settle for. If your sum insured is not an accurate reflection of how much it would cost you to re-build your premises – you are underinsured. When deciding on the limit you need to insure your premises for – do not base it off the price you paid 10 years ago. The rising cost of construction and property has significantly increased the cost of what it would be to replace today.
Example:
If you’ve expanded your workspace or renovated your office, the value of your property may have increased. Not informing your broker could mean that in the event of damage, your policy might not cover the full cost of repairs or rebuilding.
Changes in Business Operations
Why It Matters:
Changes in the nature of your business operations, including the services you provide, can affect the risks your business faces and, consequently, your insurance needs. If for example, you are a tiler but have now employed a plumber or electrician to provide additional services to your clients – you need to advise your broker. Another example may be if you own a cafe, and have recently begun to deliver catering to nearby businesses – the insurance you need and the type of cover required will be different. The current policy in place will most likely not cover you if you have an incident that occurs during a service or operation that was not listed in your policy.
Example:
Imagine you’ve expanded your business to offer new services, such as online sales or consulting. These changes introduce new risks that your existing policy might not cover. Updating your broker ensures your insurance provides full protection and doesn’t leave gaps in coverage.
Criminal Convictions or Bankruptcy
Why It Matters:
Any criminal convictions or bankruptcy must be disclosed to your broker, as they can influence your insurance terms and premiums. Insurers consider these factors when assessing the risk level of providing coverage.
Example:
If a key member of your business, including yourself, has been convicted of a crime or declared bankruptcy, failing to report this can lead to the cancellation of your policy or denial of claims. Full disclosure ensures your policy remains valid.
Updating your insurance broker with accurate and current information at renewal time is essential for ensuring that your coverage fully protects your business. At Ausure Insurance Brokers, we understand the complexities of business operations and the importance of tailored insurance solutions. Contact us today to review your policy and make sure it reflects the true state of your business.