Here at The County Group, we make sure that all of our customers have the insurance cover that they need for their business. Therefore, we believe it is important for our customers to be informed on the latest commercial and industry news!
A frightening trend has developed during the recent prolonged recession. There have been many small and medium sized businesses that have been faced with challenging trading conditions, meaning they have had to cut costs, and are leaving themselves dangerously under-insured in the process.
In particular, one UK-based wholesaler experienced these implications first hand following a major theft. After changing their purchasing patterns, the company was holding higher than normal levels of stock twice a year. Unfortunately, their insurance company wasn’t informed of this and when the thieves struck, the company found themselves under-insured by around 20%.
The application of the average clause led to a shortfall of £15,000 in the resultant claims payment, which could have been avoided with a simple policy amendment. Thankfully, the business is now fully insured after learning an unfortunate but invaluable lesson.
However, this is not the only incident that has occurred. Figures that were published by www.freshbusinessthinking.com showed that over half of small businesses in the UK are under-insured for the activities they undertake. Insurance Age has also seen that over 95% of businesses in the East Midlands are under-insured premises and plants. The Chartered Institute of Loss Adjusters meanwhile states that 40% of companies have inadequate business interruption cover.
Short term gain, longer term losses.
Although short term savings can be made by taking cheaper options, under-insurance leaves many companies facing financial oblivion should the worst happen. As well as this, claims involving disputed insurance payments can take significantly longer to process and settle, lengthening the time needed to replace buildings, machinery, vehicles and stock.
However, expert advisors can provide a solution.
It is vital to consult experienced commercial insurance providers, such as The County Group. By going through a specialist broker for your insurance, you can utilise their expertise to realistically evaluate the level of cover required and make sure that your insurance continually reflects the actual value of your assets.
When renewing your commercial insurance policy, it is also sensible to get a professional valuation. This will help to align you with cover for; actual asset value, provide third party documentation to support any claims and offer the assurance of knowing that premiums are being paid at a suitable level.
It is important that you let your insurance provider know of any major changes in your business so that we are able to match your insurance programme with your needs. Investment in your head office, increased stock levels or higher than expected turnover could all lead to changes in the amount of cover required.
To find out what we can offer you, do not hesitate to contact a member of our expert team on 0333 400 2314.