It’s a season of new growth and revitalisation, which is why spring is the perfect time to make sure your insurance cover is fit-for-purpose for your business.
Regularly reviewing your insurance coverage is crucial to help ensure that it’s appropriate as your business evolves. Here’s a guide that can help you effectively spring clean your insurance policies and avoid common mistakes.
1. Assess your current coverage
Start by identifying your current insurance policies, including public liability, property, business interruption, workers’ compensation and any specialised coverage.
- Review all your existing policies
Then, carefully review the details of each policy, noting the coverage limits, exclusions and premium amounts. This will give you a comprehensive overview of your existing protection.
- Identify changes in your business
Consider any changes in your business over the past year. Have you expanded operations, added new products or services, hired more employees or invested in new equipment? These changes can significantly impact your insurance needs. Make a list of these changes to help make sure your current policies adequately cover them.
2. Common mistakes to avoid when spring cleaning your insurance
Now’s the time to address any existing mistakes in your cover
- Overlooking policy exclusions
Overlooking policy exclusions is a common mistake. These are specific conditions or circumstances that are not covered by your insurance. Carefully read through the exclusion section of each policy to understand what’s not covered. You may need to adjust your cover if any exclusions seem problematic given your current operations.
- Ignoring inflation and higher asset value
Your existing coverage limits may no longer be sufficient if the replacement cost of your property or equipment has increased. Be sure to update your property insurance to reflect current values and avoid underinsurance.
- Neglecting liability exposure
As your business grows, so could your exposure to liability. If you have more customers, employees or physical locations, your potential for third-party claims increases. You may want to ensure that your general liability and professional liability coverage limits are adequate to protect against higher risks.
3. Making changes to your policies
Spring is a great time to review your cover if you haven’t done this for 12 months or more.
- Adjust coverage limits
Based on your review and risk assessment, you could adjust your coverage limits to ensure they match your current needs. Increase property coverage to reflect the true value of your assets and raise liability limits to help protect against higher risks. Review your business interruption cover to make sure it is sufficient to cover potential downtime.
“Spring is a good time to review your sums insured. Most policyholders are underinsured in the large claims we manage, which creates many difficulties for policyholders. So now’s the time to review your sums insured so if you do make a claim, the policy is more likely to cover the loss,” says Steadfast Broker Technical Manager, Michael White.
- Update Policy Details
Ensure all policy details, such as your business address, contact information and the list of insured assets are accurate and up-to-date. Incorrect information can lead to denied claims or inadequate coverage, so take the time to verify and update these details.
Make insurance reviews an annual habit. Schedule a specific time with your broker each year to assess your coverage, even if you think nothing has changed. Regular reviews can help catch potential issues early and help to ensure continuous protection for your business.
Important notice
This article is of a general nature only and does not take into account your specific objectives, financial situation or needs. It is also not financial advice, nor complete, so please discuss the full details with your Steadfast insurance broker as to whether these types of insurance are appropriate for you. Deductibles, exclusions and limits apply. You should consider any relevant Target Market Determination and Product Disclosure Statement in deciding whether to buy or renew these types of insurance. Various insurers issue these types of insurance and cover can differ between insurers.
Steadfast Group Ltd ACN 073 659 677
Important notice Steadfast Group Limited ABN 98 073 659 677 and Steadfast Network Brokers
This article provides information rather than financial product or other advice. The content of this article, including any information contained in it, has been prepared without taking into account your objectives, financial situation or needs. You should consider the appropriateness of the information, taking these matters into account, before you act on any information. In particular, you should review the product disclosure statement for any product that the information relates to it before acquiring the product.
