05 Sep Eternity Insurance Spring 2018 Newsletter
Spring represents a fresh start and we believe it’s the perfect time to take a fresh look at your business and decide whether your current practices are best serving you. This season we’re particularly focused on ensuring your business is fully protected to keep things running successfully.
Our expert team have advice for you on how to avoid underinsuring your business and a vital type of insurance you need to maintain productivity if your machinery breaks down.
Avoid the Trap of Undervaluing Your Business
Too many businesses fall into the trap of undervaluing themselves in an attempt to minimise their insurance premium. It seems like a good way to decrease the costs of running your business but in the long run, it can cost you far more than you’d expect.
To put it simply, when you insure your business, you are simply transferring the risk of damage or loss over to the insurance provider. This, of course, comes at a cost and the premium you pay is calculated based upon the amount of risk the insurance provider is taking on your behalf. They consider the occupation, business environment, annual turnover and the sum insured to calculate your premium. The more risk, and higher chances of a large payout from the insurance provider, the higher the premium.
When you underinsure in an effort to lower the cost of your premium, you are transferring less of the risk to the insurance provider. In the event of loss or damage to your business, the insurance provider will only pay out for the risk they’ve taken on and the risk you took on yourself is your own responsibility.
It’s easy to be sceptical about the value of insurance but you’ll quickly regret underinsuring your business in the event of unforeseen circumstances that cause damage to your goods, premises or equipment.
In the end, your premium is only a representation of the value of your insured goods and the amount you can later claim to cover your own costs.
When considering the value of your insurance and the amount of insurance you need, there are a few things to consider:
- Rising building costs
- Increase in costs of materials
- The new value of upgraded equipment
- Increases to your annual turnover
- Impact of the business interruption indemnity period
To avoid underinsuring you should:
- Seek expert advice and valuations
- Correctly estimate the value of your assets and regularly update them
- When updating your contents or renovating your business premises, don’t wait until your renewal date to increase your cover
- Ensure regular maintenance and repair work is carried out on your business premises to prevent accidents
To avoid falling into the trap of underinsuring your business, talk to one of our insurance professionals who can review your current insurance and offer advice on the best protect your business and give you peace of mind.
Equipment Breakdown Insurance Is Vital For Your Business
Machinery is prone to breakdown, and it doesn’t matter how much you paid for it, how well you maintain it or how recently it was purchased. Over time, machines experience fatigue the same way humans do and unexpected errors can occur that cause a lot of difficulty for your business.
It’s not only the high costs of repairing or replacing equipment that you have to consider but also the loss of productivity while your machine is out of order. You still have to pay your staff when machinery is down and you lose a source of income. The costs can quickly add up.
That’s where Equipment Breakdown Insurance helps.
Equipment Breakdown Insurance will cover your losses for sudden and accidental machinery incidents such as:
- Equipment breakdown leading to the deterioration of frozen goods
- Losses to business turnover due to equipment breakdown
You should consider that there are a few things that aren’t covered. General wear and tear, natural corrosion or erosion of material that’s part of the machine and deterioration are all considered part of owning the machinery and are not claimable on tax.
Due to the urgent nature of machinery failure, Equipment Breakdown Insurance allows you to contact a technician for urgent repairs before you contact your insurance provider. Our expert team will be able to guide you on the best ways to make the most of your insurance policy and protect your business.