Review Your Business’s Insurance Policies at least Annually

 

Building Costs – Rebuilding costs continue to rise so that last year’s replacement value may not be adequate this year. Furthermore, you need to take into account the cost of removal of debris, additional costs for rebuilding based on new building requirements due to changes to building codes, heritage issues (if applicable), legal and professional fees such as architects, engineers, surveyors, site conditions and zoning restrictions (to name a few) – all of which can have a major financial impact of the sum insured. 

  

Contents – needs to be insured for the replacement value, not the depreciated value you use in your accounting records. It is important to ensure that your contents remains adequate each year and takes into account any new additions. Also should include your office fitout (if applicable). Redundant contents, such as machines also need to be taken into account for replacement value or specifically noted as not insured under your policy. 

Stock – needs to reflect your stock holdings. Most policies have a seasonal increase cover, whereby if you have busy period, such as the lead up to Christmas or public holidays, the stock cover automatically increases under the policy. If this is applicable to you, review your peak periods and check the cover available under your policy, so that you have additional cover for these peak periods. 

Business Interruption – review your insurable profit based on historical turnover, taking into account any projected increases for the insurable period and thereafter as if a loss was to happen on the last day of the policy.

Liability and Professional Indemnity – review what changes have occurred within your business and assess whether your business may have an increased exposure due to factors such as the type of customers in which you look after, size of contracts, insurance obligations in contracts to name a few. 

Workers Compensation – at the end of the policy period you will be required to do a declaration of Actual Wages paid during the policy period and your policy will be adjusted if there is any variance and an additional premium or a refund may be due. You will also be required to declare your estimated wages to renew your policy. Also, remember to notify changes to your business to your insurer with in 14 days.