Instructions For Maintaining Properties
In order to comply with your insurance cover the property that is insured must be regularly maintained with special attention to any requirements imposed by the insurers following a survey of the premises. The following points are just a few of the things which must be carefully considered:
1. Make sure the electrical inspection certificate is up to date.
2. Any flat roofs must be inspected and any defects repaired.
3. Gutters should be inspected and cleaned out as necessary.
4. Storm drains should be inspected and cleaned out as necessary.
5. If an alarm is required by the insurers then it should be checked in accordance with NSI, SSAIB requirements.
6. Check to see that any roof mounted equipment is secured soundly and also check that lightening conductors are connected and there is no break in the connection.
7. Complete a fire assessment in accordance in accordance with H&S requirements.
8. Trim back any foliage and have trees pollarded regularly if necessary.
9. Fire extinguishers must be checked annually.
10. Check all stairways and walkways for surface defects where trips or falls could occur.
These seemingly basis steps are so often overlooked and in the event of a claim can be a reason insurers do not pay. The insured has a duty of care and as a result, you must make sure basic steps are carried out to ensure you do not invalidate your policy.
To discuss your property insurance requirements contact Bromwall on 01707 883377 or email us on info@bromwall.com
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Why Do I Need Directors And Officers Insurance?
In todays world it is a fact that legal actions and investigations are becoming commonplace. Legal costs are just for starters, many directors and managers of UK business are becoming increasingly concerned about the time taken to defend such actions and the harm to reputation that too often follows.
Investigations into companies and their management are a growing source of exposure for directors. Following the financial crisis, regulators in the UK and around the world have stepped up their activities with particular spotlight placed upon the conduct of executives. Regulators do not discriminate between listed companies, and those that are privately owned and managed. It is these smaller firms, often with less resources, that may find themselves susceptible to the ever changing legal and regulatory landscape, for which directors, senior managers and even employees can be held personally liable. Without Directors liability insurance, an individual may have to pay personally to defend any allegations of wrongdoing made against them – even if they are, and proved to be, innocent.
One of the latest developments to affect directors is the introduction of the the UK Bribery Act which not only covers UK organisations but UK nationals and residents also. Any company or partnership could be found guilty of violating the law if it does business in the UK, even if the actual act of bribery took place in an overseas location. Individuals who can be covered under a traditional D&O policy could face fines & sentences of up to 10 years in prison if they are found guilty of offences under the act, including disqualification proceedings. A standard Directors and Officers policy will provide protection for individuals from the significant costs of defending themselves in bribery and corruption investigations and allegations – up until the point guilt is proven.
Bromall Ltd are able to arrange comprehensive Management liability policies with W R Berkley Insurance (Europe) Ltd, a long time provider of Directors and Officers insurance in the UK market. A robust management liability policy will, in addition to D&O coverage, provide cover as standard for Corporate legal liability and Employment Practices liability (EPL). EPL provides cover for claims made by existing, former or even prospective employees with common claims scenarios involving allegations of unfair dismissal, sexual harassment or discrimination or racial discrimination.
Whilst Insurers are seeing a stark uplift in claims, broad coverage is available at competitive pricing. Bromwall are able to place coverage swiftly, with minimal fuss, and for a premium that is often less than the cost of a solicitors hourly rate.
Thanks to Duncan Goddard for his valuable input.
To discuss your Directors and Officers needs or to obtain a quote contact us on 01707 883377 or email us on info@bromwall.com
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BIBA 2013
Bromwall attended the BIBA (British Insurance Brokers Association) conference 2013. As always this was a great chance to meet with underwriters and companies that are shaping the insurance industry in the UK. This not only provides the opportunity to meet with underwriters but also discover new products being launched into the market.
2013 was held in the Excel Conference Centre in London. A great conference and thanks to everyone we met.
Laurence Shahlaei (Britains Strongest Man), David Walton and Geoff Capes at BIBA 2013
Contact Bromwall on 01707 883377 or email us on info@bromwall.com
Is Your Insurance Cover Correct?
There are some Brokers and even some insurers who will provide an insurance quotation even though they must be aware that the cover they are providing is not fit for purpose.
Business interruption is often miscalculated and under insured, and in the event of a major claim, leaving the client with a large loss which could result with the business failing.
Brokers in order to compete with an existing renewal will try every trick to reduce the premium in order to gain the business. The client is completely unaware and quite happy to pay a lower premium.
We have found that one way to reduce the premium is to quote business interruption on a gross profit representing 12 months when the existing indemnity period is 24 months. This can roughly reduce the premium by about 30% but in the event of a claim the client will be underinsured. Brokers will also obtain quotes on reduced turnover and wages. This leaves the liability cover underinsured. Although this does not affect the cover it will produce a large additional premium at the end of the term.
There has also been an instance of a broker reducing material damage cover to indemnity only. This would only show up if there was a claim and the payment would not be on a replacement basis but on the basis of the value of the goods at the time of loss, less wear and tear.
If an insured is offered a premium well below their existing premium examine this very careful as it may not be worth the paper it is written on.
We are happy to discuss your Commercial Insurance queries with you – call us on 01707 883377 or email us on info@bromwall.com
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Liability Insurance Injury Claims
From the 1st April 2013, new regulations came into effect that change the way employers and public liability insurance injury claims are dealt with.
If your business faces a claim with a value up to £25,000, the process in which it is dealt with has changed. So how does this impact on your business? This is the new protocol:
1) All personal injury claims must be reported to your insurer by the claimants representatives via an electronic portal (already carried out for Road Traffic Act claims since April 2010)
2) Three stages to the process are applicable with strict timescales and fixed costs payable at certain stages.
3) Once an insurer is notified, they have 30 days to admit liability in respect of employers liability claims and 40 days for public liability claims.
4) If contributory negligence is alleged, the case will fall outside the process and is expected to attract higher costs.
5) Under an employers liability claim the defendant has to provide details of earnings within 20 business days of the admission of liability.
As a policy holder, what am I expected to do?
Its advised to keep claims within this process so as to keep costs down. To do this you will need to:
- Notify anything you think will or may be a claim immediately. If you are not sure, notify anyway (speak to your broker)
- Obtain and gather as much information as you possibly can surrounding an accident or incident. This is so an early decision can be made by your insurers and avoids the need for detailed investigations to be carried out by your insurers, incurring further costs.
- Take an objective opinion of who is to blame and if there is only a small element contributory negligence, consider the cost benefits of an early admission to insurers against costs payable if the claims falls outside the process.
We are happy to discuss your liability queries with you – call us on 01707 883377 or email us on info@bromwall.com
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Increased Cost Of Working Insurance
Increased Cost of Working Insurance – What is it?
The purpose of the policy is to provide funds following a loss resulting from an insured peril. When you declare a sum insured and limit of indemnity, you are selecting cover for loss of insurable gross profit. Under normal policy wording this is referred to as loss of gross profit as a result of a reduction in turnover.
The increased costs incurred after a property damage loss, to limit any reduction in turnover or revenue and to maintain normal business operations. These expenses could include such items as hiring alternate premises, temporary staff, additional freight or storage etc.
Most policies limit the amount they will pay for these costs to the amount that is being saved in turnover or revenue.
Additional Increased Cost of Working Insurance
The increased costs incurred after a property damage loss, above those payable under the standard cover for Increased Cost of Working.
These will generally include any reasonable costs irrespective of whether they limit any reduction in turnover or revenue. These additional increased costs are often expended to keep or regain market share, and to maintain normal business operations
You must make sure that a full business interruption (loss of gross profit) policy is not more suitable. Your broker should be able to advise or if you wish to discuss with us please call or email.
To discuss your business interruption requirements with us contact us on 01707 883377 or email us on info@bromwall.com
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Door Locks and Your Insurance
Your policy may specify the security locks required on doors. The usual standard requested is to BS3621 2007 version. If your lock was fitted prior to 2007 it may not conform to the latest standard. The new requirement is for the bolt to have a throw of 20mm rather than the 14mm of the earlier British Standard. Most BS3621 locks have an anti pick device built in to reduce the chance of the lock being picked.
It has come to our attention that some insurers are taking a very hard view of this requirement and claims could be repudiated if this is overlooked. Don’t be caught out. Check your policy wording and endorsements and ask your broker if you are unsure. Your broker is there to help and guide you. They must point out any requirements your policy may have.
If you are unsure then obtain the advice of a local locksmith.
Speak to Bromwall if you wish to discuss further or have any queries. Call us on 01707 883377 or email us on info@bromwall.com
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How To Calculate Your Business Interruption Insurance
It is reported that 8 in 10 large commercial insurance claims are underinsured in respect of their business interruption insurance. We have compiled the following to help you calculate your cover and what it all means:
In order to make sure that you are properly covered it is necessary to know how to calculate the amount of Gross Profit that you need to insure. If you require a two year indemnity period then, in effect, you have to review the expected level of Gross Profit to be earned in what would be years 2 and 3 after the first year of insurance.
For example if, at the end of 2012, you were calculating the Gross Profit to be insured for a 2 year indemnity period commencing 1 January 2013 and ending 31 December 2014 then you need to calculate the Gross Profit for the period 1 January 2014 to 31 December 2015. The reason for this is that your Business Interruption Policy pays for a two year period from the date of a loss. If the loss is at the end of your current intended policy period ceasing 31 December 2013 then your claim will run for year 2 (2014) and year 3 (2015) and it is this period that needs to be insured.
Example (if calculating for a 2013 policy):
You must identify Gross Profit and Turnover for the years 2010 to 2015. Estimated figures should only be used when actual figures are not available. The anticipated Gross Profit for the two year period 2014 (£3,200,000) and 2015 (£4,000,000) gives an amount of £7,200,000 for the 2 year indemnity period to commence 1 January 2013. This exercise needs to be reviewed for each policy renewal and the Gross Profit insured amended accordingly. This form of cover is called a “Sum Insured” basis.
If the Gross Profit is underestimated then you run the risk of having “Average” applied to your claim on a “Sum Insured” policy. This is where, if for example, you insured for £6,480,000 instead of the correct figure of £7,200,000 and had a claim of £1,000,000 then insurers would only pay 90% (£6,480,000 / £7,200,000 = 90%) and proportionately reduce the claim to £900,000.
To avoid average being applied you should be insured on an “Estimated Gross Profit” basis which would remove the problem of average. Although the figures that you are using may be estimated you must specifically request an “Estimated Gross Profit” policy from your insurers otherwise they will issue a “Sum Insured” basis with an average clause included. We recommend the use of an “Estimated Gross Profit” policy – please speak to us about arranging this cover for you.
Business interruption can appear a real minefield. If you wish to discuss your requirements or have any queries, please do not hesitate to contact us.
Call Bromwall on 01707 883377 or email us on info@bromwall.com
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Sub Contractors Insurance
From time to time we all use the services of a contractor. Traditionally we immediately think of a contractor as a builder or plumber. If they are carrying out work on your behalf on your equipment or premises, it is essential you ensure they carry liability insurance. While this is true for manual trades, what about other trades who come into your work place? Computer companies, telephone suppliers, cleaners, alarm installers? If they are acting as a bona fide sub contractor, they too must hold the correct cover. If they are providing you with advice (computer/telephone suppliers, alarm companies etc) they should also hold professional indemnity cover.
A bona fide sub-contractor is generally deemed to be contractors who supply their own materials and tools and do not work under the direction of the insured.
When employing a bona fide subcontractor to carry out work for your business or on your premises you must have details of their Employers and Public liability insurances and note the Insurer, policy number and renewal date. Normally a contractor will provide a declaration of their insurances which you should keep as record.
A labour only sub-contractor is usually an employee who works under your direction and must be covered under your insurances.
If you have any doubt on how to determine the above or require any advice, please call us on 01707 88337 or email us on info@bromwall.com
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7 Commercial Insurance FAQ’s
Here are a selection of FAQ’s often asked by clients regarding their commercial insurance. From property insurance and office cover to contractors and full commercial combined policies, its important you understand your cover.
1) What is an excess/deductible?
Most policies have an excess of some kind. You will be responsible for the excess (for example £250) and the remaining amount of the claim is paid by the insurers. This is to prevent a number of small claims being submitted to insurers and helps to keep the premium down. In some cases you can increase the excess and reduce the premium. You should however always keep the excess to a reasonable amount. Insurers may place a compulsory excess on the policy where they set the amount. Some insurers are placing a £10,000 excesses in respect of flood in some areas.
2) Do I need terrorism cover?
It is not compulsory but HIGHLY recommended. If you have a loan or mortgage secured against your business, the bank will insist you maintain cover. We have produced an information page you can read here which provides further information on this peril.
3) What cover do I have to have by law?
Motor and employers liability (if you are employing staff) are required by law. Some trades have to carry professional indemnity insurance (insurance brokers as an example!). Although you may not require a particular insurance cover by law, you should carry adequate cover to protect your business and its staff. If you have a loss you risk loosing everything you have built up if you are not insured.
4) Why do I need a disaster recovery plan?
In the event of a claim you know to tell insurers but what do you have a plan to keep the business running? Where do you go for IT support? Can you obtain more stock if you have a fire? Where can you operate your business from if the building is flooded? There are many situations that can arise. A disaster recovery plan will keep your loss to a minimum and ensure your business can continue to run smoothly. Check out our information here.
5) What if my business changes during the year?
Your insurance has to be able to change as your business changes and grows. Its essential you keep your insurers in the picture and up to date with your operations. Insurers want to know if you change your sales line or enter into another field of expertise. If you need to increase sums insured or add items, your insurance policy will be totally flexible. Your broker should be there to support and advise you with any changes that you may need to make.
6) How do I make my insurance cheaper?
Make sure you have a good insurance broker! Your broker should review the market and make sure you have the best policy available for your business. Remember: There is always a rate for the risk. Driving your premium too far down may leave you with a policy that is not worth the paper it is written on. If your insurance policy seems very cheap, make sure you have the background on the insurance company. If you have never heard of them, be careful. Like buying a product, if it is too cheap to be true, it probably is. The last thing you want is to find out the insurance company you are with is not going to pay out when you have a claim.
7) Why should I use broker?
When arranging your commercial insurance, a broker will approach the market and obtain the best quote and cover available. Often you will find your commercial portfolio will be made up of several different insurance companies. This is because some insurers specialise in certain parts of a risk and a portfolio has to be built with several different sections. Unlike going to a direct insurer or through a compare website for a single motor or household insurance, commercial insurance remains very technical and relies on the expertise of the broker and insurers to create a policy which will cover your business needs. A broker will look after your needs and support you through out the life of your policy, providing advice and helping if a claim occurs.
To discuss your commercial insurance requirements further contact us on 01707 883377 or email us on info@bromwall.com
Images courtesy of Stuart Miles / FreeDigitalPhotos.net
