In comparison to most other industries, access to business insurance products has not changed that much in the last two decades when it comes to direct channel approach. Businesses still seek the advice of a broker, intermediary or another third party in order to find the right insurance, but this is not the case for consumers who use online comparison sites to access insurance services.

Nowadays, instead of accessing services or products through a third party, such as a retailer or a consultancy as the internet now provides quick and direct access to all kinds of services.

If you want to find a good deal on flights and hotels, it is no longer common to go to a travel agency. Instead, you just use a holiday website that quickly tells you about cheap flights and provides reviews on hotels.

Although everyone is looking for a bargain, there are some purchases where the risk of something going wrong far outweighs the value of a small financial saving. Travel is a great example, the internet is littered with negative reviews giving bad feedback on bargain flights and hotels that have resulted in nightmare scenarios. The crowd sourced wisdom generated through reviews is a really useful way to research purchases before making a decision, but even then there are risks.

When it comes to business insurance the solution often has to be tailored to the needs of that specific business, as “off the shelf” products are rarely sufficient.

In the last few years, company registrations at Companies House have hit record highs, indicating growing interest in starting a business rather than pursuing traditional career paths. Many of these new businesses are creating innovative products and markets, testing the limits of existing insurance services and requiring even more tailored solutions

Whether you are a recent start-up a seasoned sole trader or an established company, selecting the right insurance for your business is a vital step in this process. Reviewing and renewing are equally as important because no business stays the same year on year.

 

Source: Startups.co.uk

 

So, what is the most cost effective approach? Researching the market ourselves or seeking the advice of an insurance broker?

As a business, we know that we have to be insured, we know how it operates and the details of the operation; however, it’s very difficult to marry this knowledge to the range of insurance products and services on the market. If the focus is on cost we may not spend enough time researching and learning about the products or may simply be attracted to the lowest priced option because it “seems” to include everything we need.

Whether you are operating as a sole trader, self employed as a mini cab driver, running a local shop as a Limited company or in some sort of partnership with associates offering business services, the needs of your business in terms of insuring against risk will vary massively.

Insurance is all about risks – From the perspective of any small business for example, in the worst case scenario, the right insurance cover can directly affect the future of a business. If a street is affected by natural disasters such as flood or storm damage and the shops nearby are forced to shut down for a couple of days, the retailers lose a lot of money which is sometimes enough to put them out of business. In this case, the right insurance can be vital to save the shops’ financial situation and trading future.

Source: Yorkshire Evening Post

If you provide advice to businesses it is critically important that you are insured against liability and indemnify yourself of any responsibility should things go wrong. These sort of insurance options can vary significantly between different industries based on regulatory legislation, and if you operate in a range of countries this can be even more complex.

Even becoming a minicab driver can present risks that need to be managed. Not everyone appreciates that special car insurance is required to carry passengers and even those who do aren’t always aware of the options available to get the right cover at the right price, taking into account things like the number of days a month they will work and over what period.

The well know consumer insurer ‘Directline’ has made a first attempt to approach business clients through a direct channel without the help of a third party.  This could be considered as a more cost effective way of purchasing insurance, however it is important to look at what you get for this. One of the main issues is the fact that companies like Direct Line only promote their own products and lack flexibility, there may well be other providers who better meet your needs.

 

In contrast, a good broker knows the market and keeps up to date with all products and service providers. When finding the right insurance, the broker takes the time to fully understand the nature of your business and your specific needs, resulting in minimal effort on your part and peace of mind that they will find the right policy for you. A good relationship built on trust and impartiality is vital for finding the insurance that suits your business. Furthermore, this personal approach allows you to join the network of companies and consumers serviced and the broker might recommend your business to other clients that you might consider as your target customer base.

“One of the key principles of insurance is ‘utmost good faith’. That is not just for insurers; it is really important that consumers and businesses play their part in this.” Telegraph article Millions Lie…

Andrew Says…

“A lot of businesses under insure, especially newsagents, off-licences, grocers. They are often tempted to claim to have a lower amount of stock to bring the premiums down.

What can happen is that the small business get a quote from a broker, which they find expensive and they go on a comparison website, search for the quickest and cheapest standard cover. They often do not understand the fine print, and there is a danger that their business is not standard due to their individual circumstances.

 

They do not read the policy fully and assume many things, which if you do not claim makes your insurance cheaper.  If they need to claim it becomes much more expensive as they tend to have the wrong cover and cannot complete a claim.”

Whether you’re a business, an insurer, a broker or an intermediary, why not make your contribution to the debate through a series of surveys that are set to provide more insight for the industry…

 

Make a contribution today and start the survey!

SME Survey – https://model.dicematrixconsulting.co.uk/Surveys/SurveyLogin/84/0

Insurer Survey – https://model.dicematrixconsulting.co.uk/Surveys/SurveyLogin/84/1

Dice Matrix Website – www.dicematrixconsulting.co.uk

Marketing Insight Website – www.mktinsight360.com

 

Announcements will be made in May 2016 by Biba regarding how to access the insights generated.

Before embarking on any kind of home improvement or building works, the most sensible first step many people fail to take is to review your insurance policies. Both Buildings Insurance and Home Contents can be affected.

Mundane and boring I know, you just want a beautiful new house, but you would be surprised how many people can get themselves into trouble by jumping straight into a project like this without getting some simple free advice that could save them thousands.

You may well be one of the majority of people who didn’t realise:

• Any changes to the existing building can breach your existing insurance contract making it null and void.
• If you are found to have been in breach of contract, on any insurance policy, you may find it difficult and more expensive to get insurance in the future
• Major building works that involve external walls and roofing could create a security risk that affects your home contents cover as well as buildings insurance

There are many more considerations like this that a reputable and professional insurance broker can identify in relation to your project, making you aware of the risks and advising on the best way to arrange additional cover and/or amend your existing policies, meaning you can sleep at night while the building work is carried out.

While it’s tempting to cut corners and rely on internet comparison sites to find you the best deal, without the trained eye of a broker to check through the detail a huge number of people find themselves under-insured or with the wrong policy for their needs.

(Find new stats around growth in home improvements, building work issues and or use of brokers)

After the initial impact of the 2008 Credit Crunch, where many householders adopted the mantra “improve don’t move” there was a sharp rise in extension building. But as the crisis turned into a recession, building work tailed off considerably for several years. Since 2013 home improvements have once again been on the rise, with this trend expected to continue (marketresearch.com)

It is a concern then that, with so many people taking on building projects, so few are approaching insurance brokers for the free advice and peace of mind on offer. As of 2012 an estimated 37% of consumers sourced insurance products through an independent intermediary while 32% went direct online or over the phone and the remainder relied on retailers and other agencies such as banks to provide a solution. (abi.org)

Let’s paint a picture:

Your child has a band and they are very talented.  You have space enough to the side of the house to build an extension, so you create a music studio for them practice and record their songs. During the work the property will be less secure as the usually secure garage and gateway will be removed for a time, this could have a massive impact in terms of insurance. Also, once the work is finished, the music studio equipment and instruments belonging to your child and their friends will include several high value items that may not be covered by your insurance or theirs. A potential minefield of risk, but a simple conversation with your insurance broker will make sure every issue is considered and policies reviewed. Whether you need to declare specific high value items or talk to the parents of other band members about amending their policies to include “off-site” cover, you will always receive the right advice to make the right decision.

Carrying out any sort of home improvements can create a range of risks and lead to different types of damage to home and property. Anything from dropping a light bulb to damaging expensive electricals like a television, not to mention unreplaceable items like wedding photographs. Having the right policy in place before you start reduces the risk massively, its all about communication. Speak to a broker and let them take the strain. They can take time to go through your existing policy in detail, check on specifics such as whether items will be replaced ‘new for old’, advise you on the best course of action and even liaise with your existing provider to make sure they have all the information they need.

There is also then the question of your contractor’s insurance. There will be some things that you can’t insure against but they can, it is always worth asking them the question and if you are unsure ask to see their insurance details and get your broker to take a look to help reassure you that everything is in order.

If you’re still not sure about how to prepare for a building project, just call us to talk it through and we can take care of it for you, otherwise here’s our basic checklist…

• Inform your insurer – Let your insurer know what work is going to take place in good time before starting. They may need time to send someone around to assess what cover levels are needed during the build
• Be totally honest – Be clear with your insurer so that you get the right cover. Ask them to explain what changes you need to make and possibly get it in writing if they say you don’t
• Claims failure – You won’t be able to claim for any damage and loss that occurs during the building process if you fail to notify them that the work is taking place
• New levels of cover – The work, once complete, may mean that your existing cover levels need increasing, as your house will be a different size, shape or layout
• Accidental damage – If it’s not already included as part of your policy, consider paying a little extra for the duration of the build to cover you during the period where the risk of accidents occurring obviously increases dramatically.
• Moving out during the build – If you vacate the property for more than the acceptable length of time as stipulated in your home cover, you could invalidate the policy.
• Consider adding legal cover – This would ensure that if you get into dispute over bad workmanship or contractual agreements, you can get financial assistance with the legal advice you need

If you are planning an extension or considering taking on home improvements, feel free to contact Andrew and the team at Regency Insurance. Our commitment is to providing comprehensive advice that gets you the best cover for less.

There are various ways we can protect our homes from the following:

Fire

Smoke alarms really do save lives. Fit them throughout your home and test them regularly, replace batteries every year. If in doubt, most local fire services will visit your home free of charge to advise on where you should put smoke alarms and to point out any fire hazards you should be aware of.

Kitchens are where most home fires start. Use a thermostatically controlled deep fat fryer if you regularly cook with oil. Be careful with lit candles and cigarettes, make sure they are properly extinguished and never smoke in bed. Don’t overload electrical sockets. Use fireguards with open fires and have your chimney swept regularly. Remember to switch off electrical equipment at the socket – preferably don’t leave TVs or stereos on standby – and unplug them when on holiday. Make sure bonfires and barbecues are a safe distance from fences, trees, shrubs, sheds and your home.

Theft

Security locks on doors and windows are your first line of defence. Make sure they’re adequate and use them even if you are just popping out for five minutes! 5 lever mortice deadlocks can provide additional security for doors and key operated locks for windows – double glazing is recommended for windows too. Fit outside doors with toughened glass.

When on holiday, cancel papers and milk and ask someone to collect your post so that there are no tell-tale piles of letters on your doormat. Lock your valuables away and use timed switches for lights. Don’t leave DIY or garden equipment outside, lock it in a shed or in the house. Never leave keys near letterboxes as they could be easily taken without a thief having to get into your home. An alarm from an approved supplier will not only help protect your home, it could also bring down the cost of your premium. Join your local Neighbourhood Watch scheme, or if there isn’t one, why not start one?

Burst pipes

Most burst pipes happen in the winter when the water freezes. Proper insulation and lagging will help protect pipes and tanks in the loft and outside.

Leaks

Check your radiator valves regularly for leaks. Guttering should be kept clear of leaves and moss and any damaged sections repaired. Damp patches, blistered paint and areas of mildew in your home, could be signs of slow leaks. Keep an eye on washing appliances and make sure they are properly fitted. Check overflows around your home periodically, as well as ball cocks on toilets.

Many people, when asked how much they’d need to rebuild their home would have little or no idea. Your estate agent’s valuation report is a good estimate for the amount of cover you need. Be careful not to confuse its market value i.e. what you bought it for or could sell it for now, with its rebuild cost, as there could be a big difference between these.

Quite a few companies now offer blanket cover of up to £500,000 or £1 Million Building sum insured and anything from £30,000 to £100,000 Contents cover.. This makes life easier for you because you don’t have to have an exact figure before you can get insurance.

If you have particular valuables that you want extra protection for, mention this when you are choosing your policy or check the ‘specified items’ amount covered in your policy. Some companies will cover certain items at no extra cost.

Most policies will include an excess. This is the amount you will need to pay towards any claim. This can be paid directly to a supplier or deducted from your settlement, but if you are comparing policies make sure you compare the same excess on each one.

Is the cheapest policy always the best?

No not necessarily, it depends what your individual needs are. Look through the policy document carefully to see what is and what isn’t covered. The cheapest policy is usually standard cover.

For contents insurance, think carefully about what you want to cover before you choose the cheapest policy. It might be safer for you to spend a little more on your premium to look after the things that are important to you. For example, if you are a keen cyclist and you own an expensive bike, make sure it’s covered as a specified item. If its value is greater than the single item limit, then it’s common sense to pay a little extra to protect it.

Get new for old

Check that the policy you choose replaces new for old. New for old protects the value of the things you own, so that the full cost of replacing them if they are stolen, or repairing them if they are damaged, will be met.

Home insurance can mean building insurance, contents insurance or both. Building insurance covers the cost of rebuilding your home should the worst happen. It generally covers you for damage to your home caused by fire, bad weather, natural disasters, damage caused by burglary or attempted burglary, vandalism and subsidence caused mainly by tree roots or ground heave. Coverage will differ between home insurers so it is important to check your policy documents.

Mortgage lenders may require proof of buildings insurance as part of their mortgage offer particularly if you are a first time buyer about to buy a house. The amount of buildings insurance you take out needs to cover the cost of replacing the building itself and all permanent fixtures and fittings inside it. A Fitted Kitchen or bathroom is an example of a permanent fixture.

As well as the actual property, buildings insurance can include garages, sheds, driveways, swimming pools, paths, walls and fences. Not all policies have the same coverage for all these items as standard individual policies do differ in what they include.

Contents insurance usually covers all the contents in your home against theft or attempted theft, fire, water damage, storms or floods, smoke, lightning and malicious damage. Contents refers to all the things in your home that are not permanent and fixed, such as sofas, tables, TV’s, Home Entertainment equipment etc.

Standard contents insurance cover often works out to be the cheapest, but does not cover you for every eventuality if you need to make a claim. Adding accidental can cover you for any unforeseen accidents in your house.

Some insurance companies include cover for contents in your garden too – but the amount of cover can vary greatly.