The end of the financial year is almost here once again and many of us are in planning mode for the upcoming year. Planning our budgets. Planning our revenue targets. And planning our goals. But with all this planning going on it’s easy to forget to review our insurance needs, determine if they have changed and work out what coverage is needed going forward. A lot can happen in 12 months – especially if your business is growing. So the importance of an annual insurance review should never be overlooked.
Here are some questions you should ask yourself when it comes time to review your insurance.
Do you have the right insurance in place?
Having insurance is important. But having the right insurance is absolutely vital.
Many business owners tend to have a ‘set and forget’ attitude when it comes to insurance. They know they need insurance and organise it in the early days of their business. But then they fail to review their insurance needs regularly.
Your insurance requirements will change as your business grows. That’s a fact. Business growth will require you to broaden the number and types of risks you manage. So you need to regularly review your insurance policies to ensure they are covering the expanding scale and changing nature of your business.
A single unexpected event can be all it takes to sink a small business – even when it has insurance, but not the right insurance. An annual insurance review will ensure you take any potential new liabilities and risks into account.
Are your assets valued correctly?
Underinsurance is one of the most significant risks faced by small to medium businesses. And unfortunately, many business owners just don’t understand the potential consequences of underinsurance.
Put simply, underinsurance occurs when business assets are undervalued against your insurance policy. While this can result in lower premiums, in the event of a major claim your insurance may not cover the full cost of the loss and could lead to your business having to close its doors.
As a business owner you should review the value of your assets each year and ensure the correct sum is reflected in your insurance cover. And if you have purchased any new assets over the course of the previous 12 months, you should also make sure they are accounted for.
While your premium may end up being higher, you’ll have the peace of mind of knowing your business is protected.
Have your business circumstances changed?
As part of your annual insurance review you should also check that all the information you originally supplied in relation to your business circumstances is correct. If anything has changed, it needs to be factored into your insurance coverage.
It’s also a legal requirement for you to disclose anything you know to be relevant to the insurer’s decision to accept the risk. If you don’t, your policy may be rendered invalid in the event of claim.
If you haven’t been reviewing your insurance coverage each year, it’s time to start. You business depends on it. Emjay Insurance Brokers can help you undertake an annual insurance review. They make it easy for you to access the advice and services you need to ensure your business has the right insurance cover when it comes time to renew. Contact us today on (02) 9796 0400.