Business insurance can be complex, with different types of insurance, different policy terms, lots of insurance jargon and businesses that have unique requirements.
As a commercial insurance broker, our team are here to help and support our clients. We’re always here to answer any questions that our clients have. Some of these questions and answers are bespoke to individual clients, but many are general business insurance questions. So, here is just a short summary of the questions we often get asked.
What is the difference between Employers’ Liability and Public Liability?
The key difference between public liability and employer’s liability is related to who is making the claim against you or your business.
If a claim against you is being made by an employee, then an employers’ liability policy could provide the cover. For example, if an employee suffers an injury because of a work-related accident, then your employers’ liability policy can cover the cost of any legal defence or compensation payments you are required to make.
A Public Liability policy responds when the damage is caused by your negligence and results in damage to a third-party person or property. For example, if a member of the public trips over a hazard such as a loose cable in your restaurant or shop. Again, this type of insurance is designed to cover the cost of any legal defence or compensation payments.
What should I do if someone makes an insurance claim against me or my business?
If someone has stated their intention is to make a claim against you, you think someone is planning to or if you feel there may be an issue that could result in a claim being made against you, then you should follow the steps below:
- If your business is insured via an insurance broker, you should call your broker first.
- If you insure your business directly with an insurance company (i.e. if you’ve purchased insurance directly online), then you should call the insurance company.
- Call either of the above before speaking to or communicating with the claimant. It’s important to handle the initial communication in the right manner and not admit liability.
- Your insurance broker or insurer may be able to handle that claim on your behalf.
- Stay as calm as possible and let the professionals handle the claim on your behalf.
What happens if I don’t report a claim or issue immediately?
We would always urge you to speak to your insurance broker or insurance company (if you purchased insurance directly and not via a broker) as soon as you feel there could be a claim against you or as soon as it is made.
By not reporting a claim or potential claim immediately it can be harder to gain evidence such as photos or witness statements that support your defence of the claim. Delaying the notification of a claim may also prejudice the position of your insurer in defending any allegations.
What do I need to consider when renewing my business insurance?
Renewal of your business insurance is often a time to step back and take stock, evaluate changes in your business, risks, costs and your current insurance cover.
You shouldn’t wait until the last minute to renew your business cover and certainly don’t just go for an automatic renewal. Things may have changed in your business or in the insurance market.
Always use an insurance broker who can advise you specifically on your business insurance renewal needs.
Here’s our business insurance renewal checklist to help you with the process.
If there is damage to my business premises, how do you work out the value of the damage?
This will depend on what has been damaged and the extent of the damage. It may require a loss adjuster to visit the premises to be able to work out what has been damaged, to what extent, and whether it requires repairing or replacing.
Valuing replacement costs is often done using methods such as:
- Replacement Cost Value.
- Actual Cash Value.
- Fixed Value Replacement Cost.
Invoices or receipts for the item that was damaged can also be particularly useful when making a claim.
Why should I use an Insurance Broker?
The commercial insurance market is a complex area with different insurers, policies and levels of cover, so having an experienced insurance broker to advise you can make a huge difference to the outcome for your business.
Here are 5 reasons to use a commercial insurance broker:
- Professional, impartial and expert advice.
- Service levels to monitor your needs including policy terms and adequacy of cover.
- Help you to identify and manage risk that you may not consider.
- Access to a wide range of insurers, products and policies and assessing them on your behalf.
- Supporting you throughout the claims process.
Read our blog 5 reasons to use a commercial insurance broker for your business insurance for more detailed information.
What is cyber insurance and why is it important?
Cyber insurance is cover that will protect your business from threats such as cyber-attacks, data breaches, security breaches and malicious software attacks to your IT systems.
SMEs are particularly vulnerable to cyber incidents because they can lack the resources, knowledge, and expertise to effectively manage cyber risks in the business.
Cyber insurance won’t protect you from an attack but will mitigate the financial and operational consequences should an attack occur in your business.
Read more about Cyber insurance and why is it important here.
What is Directors and Officers Liability Insurance and do I need it?
As a director of a company, you have increased responsibility and there are many cases where Directors and Officers of a company may be held liable for their actions.
Often SME’s lack the same formal control processes that larger corporates have and this can lead to mistakes being made. Many SME directors don’t always sit back and assess the risks involved around themselves or their colleagues being held personally liable.
If someone decides to sue you as an individual, then your own personal finances are at stake. This is where Directors and Officers liability insurance comes in.
Read more about Directors and Officers Liability Insurance here.
What is business interruption insurance?
Business interruption insurance covers you for loss of income during periods when you cannot carry out business as usual due to an unexpected event. For example, if your business suffers a material damage claim e.g. fire or flood it is likely they will be unable to operate for some time.
What is 'Average Clause'?
The average clause is a little-known condition of insurance policies when a customer claims on their policy and has under-valued or understated the cost to repair or replace that which is being claimed for, usually associated with buildings insurance claims. Should a property be underinsured, the insurers are not obligated to pay the full costs of reinstating the building. Instead, they will apply the Condition of Average Clause.
At the point the customer makes the claim, the insurer checks the rebuild value and if it is found the customer is underinsured by a specified amount on the policy, the insurer will reduce the payout by the same percentage.
Read more about under insurance and the ‘Condition of Average Clause’ here.
Summary
These are just a small handful of the hundreds of questions that our team get asked. If you’ve got a burning business insurance question that you want answering, contact us today and we’ll do our very best to help you.
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