When the time comes to insure your business, there are of course many benefits to using an insurance broker.
Brokers can advise you on the risks your business is exposed to and the covers it needs. They take the hassle out of finding the most appropriate policy for your business.
However, one of the most important advantages of using a broker is the opportunity to properly manage and mitigate your risks.
Your insurance premium may be higher than it needs to be because you are exposed to particularly severe risks.
However, you can work with your insurance broker and insurer to assess these risks, and develop a plan to manage them. This can have a positive impact on your premium costs.
Many insurers have specialist risk engineers working in their teams to develop plans for a wide range of risks across many different industries.
For example, if you have critical equipment or machinery at risk of storm damage, your risk engineer could suggest installing a protective structure or raising them above the ground to minimise stormwater damage.
Similarly, if you are a retailer, you could be exposed to the public liability risk of customers slipping, tripping and falling at your shop.
A risk engineer could develop a management plan that includes slip-resistant floor surfaces and a new layout for your shop.
However, risk management is more than just ‘tangible’ solutions like new floor surfaces and structures. Risk management also encompasses the way your businesses handle an event. This includes how you prepare and how you respond.
For example, if you have workers driving vehicles, whether they’re deliverers, tradies or salespeople, there is a risk of work-related traffic accidents. An increase in accidents could have an impact on your commercial motor insurance and, depending on which state you operate in, your workers compensation and compulsory third-party insurance policies.
Business owners can team up with their broker and insurer to develop a management plan that encourages safe driving, such as developing a training program for your employees. You could also implement a thorough investigation procedure for when an incident occurs in order to learn where improvements can be made.
Likewise, if you run a shop or restaurant, you could train your staff to identify and remove any trip hazards in order to avoid injury or property damage. This can be an effective way of managing your public liability and workers compensation risks.
Even having a simple plan in place to regularly store copies of your documents and files in a secure place, such as with your accountant, could have huge benefits if your business is impacted by an insurable event.
There are countless examples of businesses, brokers and insurers working together to come up with innovative solutions to challenging risks.
These solutions have worked because the business owners took the risks seriously and were proactive in dealing with them.
Your business could face these risks too. Fortunately, there is expert help in the form of brokers and insurers available to advise you.
John Phillips is the chief underwriting & portfolio manager – commercial, Vero Insurance
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