Businesses evolve over time. New premises, additional employees, expanded services and changing market conditions can all alter a company’s risk profile. Cover that was suitable several years ago may no longer provide adequate protection.
A thorough review before renewal can identify gaps, bring up new potential risks and highlight areas which may need increased levels of cover.
Areas for business owners to focus on:
Evaluate Recent Business Changes
Operational changes can create new insurance requirements. Opening premises, adding services, purchasing equipment or taking on larger contracts may introduce risks that existing policies do not address.
Businesses should also review staffing and payroll changes, new professional activities, overseas operations and changes to their ownership or legal structure. Insurers should receive accurate, current information to assess the exposure correctly.
Review Property Values and Business Interruption Cover
Inflation and rising labour and material costs may increase the amount required to rebuild premises or replace equipment and stock. Outdated valuations could leave a business underinsured and as a result, reduce the amount paid following a claim.
Business interruption insurance should also reflect current revenue, expenses and the time the organisation may realistically need to recover following a serious loss.
Reassess Liability Cover
Liability exposures may change as a business grows, enters new contracts or undertakes different activities. Owners should review their public liability and employers’ liability to check it remains appropriate for the scale and nature of their operations. Contractual requirements should also be considered.
Additional protection may be necessary. Depending on its activities, a business may need product liability, directors’ and officers’ liability or professional indemnity cover. An excess of loss liability cover can provide protection above the limits of underlying liability policies if exposures have increased.
Evaluate Cyber Insurance Needs
Cyber incidents remain a significant threat, some business owners may assume standard commercial policies provide cover towards data breaches, ransomware and other technology-related losses. However, more than likely, there is no cover or not adequate levels of cover for cyber incidents.
Standalone cyber insurance may cover incident response, business interruption, cyber extortion and third-party liability. Businesses should review both their cover and their cyber security controls, as some insurers may require evidence of safeguard measures in place during underwriting.
Look Beyond the Policy Schedule
The policy schedule provides an overview of the insurance purchased, but important restrictions and exclusions appear elsewhere in the policy wording. Restrictions on flood cover in high-risk areas or exclusions for cyber incidents can create costly gaps if overlooked.
Conclusion
Begin preparing for renewal well in advance. Updated financial information, payroll figures, property valuations, claims details and descriptions of operational changes can support a smoother process and help insurers assess the risk accurately.
An insurance professional can help review exclusions, endorsements, excesses and cover levels to identify areas requiring attention.
To find out more about cyber insurance and for a tailored insurance quote, get in touch with our experienced team. Call us on 0161 470 3274 or complete our quote form and a member of our team will be in touch with you as soon as possible.
