Your business is probably one of the most valuable assets you have – it makes sense to protect it at all times. The right level of insurance can make all the difference by helping to ensure your business continues to operate smoothly if the unexpected happens.
Being pro-active in frequently assessing your insurance at renewal time or when changes happen is crucial in dealing with underinsurance (particularly during a growth phase) and therefore avoid being penalised by your insurer at claim time.
Over the past 2 years, indexation levels have not kept pace with the recent and unprecedented growth in value of insurable assets. Current spike in materials, labour and reconstruction costs means sums insured should be reviewed and increased by 25%-40%.
If your policy contains an “Average/Co-Insurance Clause” you must insure the full value of the property. If you under-insure, your claim may be reduced in proportion to the amount of the under-insurance, for example:
Full Value $1,000,000
Sum Insured $ 500,000
You would be self-insured for 50% of the full value.
Claim Amount $100,000
Amount payable by Insurers as a result of the application of Average/Co-Insurance $50,000 (being 50% of $100,000)
The attraction of low premiums without taking time to make sure sums insured are sufficient and right to cover losses and expenses could prove very costly if unable to practice.
It’s also common to underestimate the replacement costs of your assets after a damaging event such as a fire or storm. It is therefore important that you insure your business assets for their most current replacement value so as to get back to business as quickly as possible. Therefore, a regular check on your insurance cover, especially in these challenging times, should be seen as a fundamental safeguard to your practice and of its goodwill.
Review your insurance cover regularly, particularly if your business is growing. You’re at risk of being underinsured if:
It’s worthwhile reviewing your house and vehicle insurance to make sure you are sufficiently covered on account of the factors discussed above.
The cover on your house may have been sufficient to meet costs when the policy was first taken out or renewed. However, construction costs have risen at a greater rate than annual increases leading to being underinsured over time.
The same could apply to your vehicle insurance depending on the cover selected i.e. agreed value or market value. With rising costs of replacement parts and delays in securing these opting for a cash settlement could leave you considerably underinsured.
At Insurance House, we have access to a powerful measurement tool known as “core logic”. This tool can assist with providing a reinstatement cost appraisal. It is a great aid in assessing insurance cover and therefore help in getting the right protection of your assets. This facility is available to all Insurance House policy holders. Speak to us today on how we can support your business.
We’ll do the hard work of reviewing your insurance strategy, adapting your cover as your business changes, and giving you peace of mind that your business and property is properly insured. Talk to a insurance House Insurance Broker today, to fill out our contact form below.
Contact a broker
Fill out the form to provide more information about your request and one of our brokers will be in contact shortly.
Copyright 2023 Insurance House Pty Ltd | ABN 33 006 500 072 | AFSL 240954
Introducing a new world of insurance that simplifies how you buy and manage your insurance policies online and making finding the right policy for you or your business easier.
If you are an existing Insurance House Online Client, you can access all your online policy details here
Should you wish to purchase a policy online click here to get started
If you are an Insurance House Client, serviced by our Broking Division and need assistance, please call your broker or 1300 305 834.
insurance.com.au Pty Ltd acts under a binding authority on behalf of the insurer/s. In all aspects of this insurance.com.au acts on behalf of the insurer.
insurance.com.au Pty Ltd is a wholly owned subsidiary of Insurance Brands Australia Pty Ltd. Our core values of care, leadership, imagination and professionalism will continue to inspire and drive us, including our friendly team of dedicated insurance professionals you have come to rely on. Any changes to your current online access or renewal process will be outlined in our renewal notice emailed to you prior to the expiry date of your current policy.
insurance.com.au Pty Ltd ABN 27 163 909 073 AFSRN 443422 is an authorised representative of Insurance House Pty Ltd ABN 33 006 500 072 AFSL 240954