Finding the right insurance package

Setting up and expanding a business is a time-consuming and expensive matter: loans and finances, premises, material, staff’s salaries, goods and advertising.... it is tempting to opt for the minimal and  cheapest insurance options required by law.
 
Businesses are an investment in money and ideas that face many risks and perils and this investment needs to be protected at all costs. Getting the right cover is not just about reducing risks, it is about protecting business from the unexpected and knowing that, should anything arise, you would be able to claim compensation for it; it is about lessening the chance of being sued by anyone (staff, client, supplier or a member of the public) if anything goes awry; i.e. about putting your mind at rest and be able to focus on your core business.
However the range of insurance policies to choose from as well as the number of occurrences to cover makes the insurance world a jungle! How to choose what is right for your company’s needs?
 
There is not a one-size-fits-all insurance policy; the type of policies you require and the amount of coverage will depend on many factors including:

  • Structure of the business: Self-employed or several employees?
  • Type of business: In contact with clients or not? Etc...
  • Business premises: home, rented or own facilities?
  • Purpose of the business – dealing with nuclear transport or even frozen foods is more risky than for instance offering secretarial services.

 
There may also be clients who will want to know about insurance cover, amongst other credentials, before entering into a contract with the business.
 
Whatever the name and aspect that they can take in different countries, there are common insurance policies that are compulsory; they include:
Building insurance: to protect the company’s premises.
Content insurance: this is about the protection of what is inside the building.
Professional insurance: this protection is especially useful in these litigious times in case of professional mistake or unexpected event affecting the service provided. Most trades or professional bodies require compulsory professional insurance.
Public liability insurance: this cover will be mandatory for businesses in direct contact with clients (e.g. beauty salon or physiotherapy clinic), not usually for BtoB transactions.
Employer’s liability insurance: to protect the employer should anything happen to a member of staff.
Other insurance policies may cover the good running of the business, in case of interruption for any unpredictable reason (acts of God...).
Failure to carry the coverage legally required is punishable by fines or prosecution depending of the size of the offense or potential danger.
 
Besides the mandatory covers, there are additional insurance policies that will benefit the company beyond the “value for money” aspect: they may include health insurance as a motivational tool for employees or to meet a quality framework, copyrights or digital assets protection. Businesses that incorporate insurance to different areas of their trade are also applying risk management methods that will give them an advantage when negotiating with financial institutions or competing for new contracts – they are showing good management practice.
 
Insurance broker or independent consultant
Finding the best insurance package at the right price is not an easy task.
Due to their uniqueness each business requires an individual business insurance evaluation that can be best done either by an insurance broker or by an independent insurance expert who will base their recommendation on benchmark data. Their evaluation will include a detailed analysis of assets, potential risks and level of cover needed.
However, the independent insurance expert will take a broader and more long-term approach i.e. not only advise on the best value for money but also take into account the business strategy and targets; they will offer insurance cover options that will positively affect not only the budget but also the smooth running of operations; they will implement and monitor the options chosen, insuring that there is no policy overlap and that the cover is keeping pace with the company’s growth. In short, the independent consultant will make sure the company gets an adequate and sustainable service as well as an optimised insurance budget.

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