A Guide to Business Insurance

Finding the right commercial insurance product can be a stressful and time-consuming process. Towergate has put together this article to guide you through the process, making it as straightforward and stress-free as possible.

Select a shortlist of up to three brokers, including your current broker

There are a limited number of insurance markets available for many commercial insurances in the UK, so you are unlikely to find a better deal by selecting a larger number of brokers. Try to select your shortlist based on referrals or recommendations and ask them about their expertise, scale and knowledge of your sector. When approaching the broker, be clear that they are one of a small shortlist, as they are likely to invest more in a potential client who is serious about using their services. Remember to ask brokers about their risk management proposition, as insurers value the effort clients make in managing their own risk and this is reflected in the pricing and terms offered.

Ignore heavily price focused quotations

When it comes to selecting companies for your shortlist, ignore those whose advertising is heavily reliant on price. Be sure to select a shortlist of companies who truly understand your business and can offer a service which is relevant to your needs and can demonstrate a successful track record.

Give yourself time to compare quotes

Ensure that you have selected your shortlist at least four months prior to your renewal date. Inform each company within your shortlist (including your existing broker), that they are part of a shortlist of X companies and set a clear deadline for quotes. Be sure to make it clear that quotes received after this date will not be considered. Lead time is approximately four months, so it can pay to start the process earlier than you might consider to.

Request a copy of claims experience

Request a five-year claims experience report and tell your current broker that they will lose your business if they are unable to provide this within your timeline. This will ensure that they cannot hold you ransom by their releasing terms at the last minute.

Which business insurance factors are most important to you?

In order to keep your insurance costs sensible, it is essential to consider what factors are important to you. Think about the current processes for claims reporting and monitoring – do you get enough information on the status of your claims from your current broker or insurers? If not, be sure to ask about this when comparing quotes. Don’t accept a quotation which doesn’t deliver the level of service you need.

Value your assets with expert help

80% of commercial properties in England and Wales are underinsured* (the level of insurance cover is insufficient to meet rebuilding costs in the event of serious damage).  Under the Insurance Act, you have responsibilities for fairly presenting your risk and providing the correct values. If you don’t have access to a valuation service, your brokers should be able to introduce you to their RICS approved company.

Seek advice on emerging and evolving risks

Your insurance broker should be able to proactively advise you on growing risks – for example, cyber and data attacks, crime, terrorism, credit insurance, environmental issues, as well as options relating to healthcare and employee benefits. Ask your broker how they keep clients up-to-date with such risks.

Discuss risk management with your shortlisted brokers

Remember to talk your shortlisted brokers through any new training initiatives, security, risk management or health and safety that you have invested in and ask how they can help further. Some insurers are willing to fund investment by the way of risk management bursaries and many good brokers will have their own risk management services they can talk you through.

Choose a provider based on their service

The company you choose should be the one who demonstrates an understanding of your business and its needs. If the best service proposition is being offered by a company who is out of your budget, talk to them before ruling them out. If they are looking for a long-term business relationship, they may be willing to reduce costs.

Take care not to overly market your insurances

Unless you have a specific business change, you shouldn’t change provider on an annual basis. Insurance underwriting is all about stability and long-term relationships with customers. Insurers will often put more attractive terms forward for a company who has a minimum three-year review process, rather than one who switches provider every year.

How Towergate Insurance Brokers can help your business

At Towergate Insurance Brokers, we don’t just offer traditional insurance broking, we believe that prevention is better than a cure. For this reason, we have our own risk management consultancy, focusing on pre-loss mitigation and business continuity.

We work with all the major UK insurers, including Lloyds of London. Our national stature and strong industry relationships, allows us to achieve a compelling client proposition.

*Research carried out by the Building Cost Information Service, part of the Royal Institution of Chartered Surveyors.

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