If you’re in business, you will need insurance to cover your business assets, employees, operations and liabilities. However, common mistakes with insurance coverage can leave a business vulnerable. When navigating the complexities of large and small business insurance policies, there are five common mistakes to avoid.
Top 5 mistakes to avoid with business insurance
1. Under insuring your business
Businesses often get caught out by not insuring assets at correct and current valuation levels. This can result in financial impacts in the event of a claim where underinsured items are not paid in full. You may be underinsured if you have changes in business activity or asset upgrades. It’s essential to regularly review your insured sums so your business has total coverage. These figures should reflect current replacement costs, not original purchase prices. Atlantic Insurance Client Managers take the time to reassess insurance needs when changes occur in your business.
2. Not creating the right insurance cover program
Standard insurance policies may only cover some of your business’s risks. Depending on your industry and operations, consider additional coverage options such as cyber insurance, business interruption insurance, or public liability insurance.
Insurance policies often have exclusions and limitations that define what is not covered, which may vary according to the insurer. Failing to understand these provisions may result in unpleasant surprises when making a claim. Carefully review your policy wording and access expert guidance from your insurance broker.
Location plays a significant role in insurance premiums and coverage. If your business operates in an area prone to natural disasters such as floods or a high crime rate, check that your insurance adequately covers these risks.
3. Overlooking the importance of risk management
Many businesses overlook the importance of a robust risk management strategy, which can make accessing insurance challenging or more expensive.Â
Identifying, assessing and prioritising potential business risks demonstrates to insurers that you are prepared for unforeseen events like natural disasters, cyber-attacks, employee injuries or supply chain disruptions.
4. Failing to analyse data and claims trends
Your business data can be used to deliver insights regarding insurance. Analysing claims data and trends can help identify patterns that can inform future risk management strategies. For example, you may experience property damage claims during colder months. This data can help your Client Manager secure more favourable terms and insurance premiums for you. A lack of awareness can result in taking out generic insurance policies that may not be tailored to your unique risk profile, which may expose your business.
5. Not consulting with an experienced insurance broker
Business insurance can be complex. Working with an insurance broker such as our experienced Client Managers at Atlantic Insurance who take the time to understand your business and have experience in your industry can ensure your business has the right coverage and is adequately protected.
How Atlantic Insurance can help you with business insurance
At Atlantic Insurance, we have assisted businesses of all sizes and industries since the early 1980s. Our team has developed a strong understanding of various businesses’ insurance needs and risks.Â
If you are unsure which policies may be the right choice for your business, contact us today. Our experienced Client Managers will provide comprehensive advice on the most cost-effective business insurance options to protect your business in the event of a loss.
Any information contained on this page of the website is general advice only and has been prepared without taking into account your objectives, financial situation or needs. Your should consider these, having regard to the appropriateness of this advice and the relevant Product Disclosure Statement (‘PDS’), Target Market Determination (‘TMD’) and Financial Services Guide (‘FSG’), which will be provided following any formal recommendation to you.