What's in a Business Pack?

After a number of posts about protecting your home and personal belongings time to turn our thoughts to your business. This is our core service. It's the protection of your business that is paramount to our community. We have seen a number of real examples where companies with incorrect or even NO insurance have suffered a loss and simply had to close their doors. What many don't consider is the value of a business to the broader community by way of jobs and economic stimulus. For a small business with say 10 employees, that's 10 families affected. Those 10 are then linked to another 20 and so on so. If the business is key to an area it's not just the loss of jobs but loss of main attraction. Shoppers may not return to smaller outlets if the main one is gone, thus damaging employment and the economy in a town.

You need to take a certain amount of risk in your business but having a complete and up to date business insurance policy in one area where you can shift that risk to someone else. Think about what types of cover you need. A business is usually covered by what is called a Business Pack. This means you can select the sections of cover that are important to you. Our role is to alert to each and every one but for your particular business not all sections may be required. Let's list some key sections. (Not exhaustive)

* Fire & Perils
* Business Interruption
* Burglary
* Money
* Glass
* Public Liability.

This is just 6 but most good business packs will give you around a dozen or more options. We recommend you consider all sections firstly and analyse what is most important or highest risk for you. For example many businesses nowadays are cashless, thus cover for Money may not be required. However if you still take cheques or money orders for examples these can be defined as 'Money' so don't instantly think you don't need it. Careful consideration of what an entire pack covers first is important. Let's breakdown some of the sections;

       Fire & Perils Section: This can confuse people as we don't list every 'peril' that is in the policy. A standard business pack will cover in the Fire & Perils section; Fire and explosion - Storm, Hail & Wind Damage, Impact, Malicious Damage, Leakage of water, Accidental Damage. Others can be and are included. These are the most common everyday claims. Within these perils are sub sections and exclusions so it's important you know what you want and what you are covered for.

In the news lately has been the Bangladesh Building collapse. We can't comment on what cover they had in place or whether the usage complied with local building codes, or if there were even any codes in place. But it's fair to suggest this will be a long claim for the insurer/s involved. It's a horrible tragedy and has larger social and global implications. However on what we are looking at consider the impact on the families and the local economy. If something similar or a large factory fire happened locally how would the community recover?

 

Business Interruption (BI) section: We've discussed this a few times, but once you have a major accident or fire for example, you still have commitments financially. This is where a lot of companies fail by not taking Business Interruption. BI covers your fixed expenses after a loss. You may still have leases, rents, utilities and most importantly wages. These don't stop if you cant open your doors. Also consider the goodwill or suppliers. They may go elsewhere if you cant trade, how long till they come back? BI provides cash flow for a period following the accident and is often the difference between remaining in business or closing with a mountain of debt.

 

Burglary section: Pretty self explanatory really but don't automatically think ALL theft is covered. Check your policy wording, is Theft without forcible entry covered? Are all items covered for theft or do they need to be specified? Are their warranties or requirements on security systems that need to be complied with before a claim is considered? Is damage to the property following theft covered?

 

Glass Section: Another self explanatory one but you can get caught out by out. We've had a client who thought glass would be covered under the Fire & Perils section if someone throws a brick through their window. On this particular policy, no, it wasn't! An exclusion to glass was in place as this would have been covered by a 'glass section.' Don't presume it's covered.

 

Public Liability Section: Covers damage to third party property or personal injury to third parties. Again, don't presume your Liability policy is correct. What exclusions are in place. I've highlighted over the months a couple of examples whereby people presume they are covered but didn't check the exclusions. You must notify all your business activities to ensure they are all covered. If an insurer covers you as a cafe but doesn't know that you also go out run a mobile food van at the local sporting grounds on the weekend, then you may not be covered for injury to someone at those sporting fields.

 

A lot of businesses simply cover what their lease agreement tells them to do. This generally Glass and Liability. This is good management by your Landlord on shifting risk to you. It's then up to you to shift this to a quality insurer and consider your own businesses needs. The above is just a snap shot of a basic business policy and some of the key sections, but consider all sections and whether pertinent to your business. Do you take stock away from your premises, are there forklifts running around, do you hold customer goods? The list goes on. Your business is your lifeblood but often also that of your employees. Take the time to talk to us about the levels of cover you need if the worst were to happen. Once we ascertain your comfort with the cover we can source pricing to work in with your budget. Considering we have access to over 130 insurance companies and agencies worldwide it makes sense to talk to us about what cover is best for your business.

 

**Information above is deemed General Advice only and does not take into consideration any one individuals personal situation or set of circumstances. Please seek advice on your own and check the Policy Wording for full cover details and exclusions.