santa business insurance

Is Santa covered this Christmas?

Far, far away in the North Pole, Santa was worried. With the busy Christmas period coming up and an ageing workforce of elves and reindeers, would this be the year something went wrong?

Santa had the same insurance for years now after a recommendation from his good friend, the Easter Bunny. But it has been year since he had sat down with his broker and gone over his insurance and his business risks.

For a busy and successful small business, Santa is typical of most business owners: “We are all busy — sometimes too busy — especially around the holidays, and I don’t have time to look at my insurance, it should be okay.” Is what I hear a lot.

If Santa was worried, he really should be looking at his insurance policy more regularly. As an insurance specialist, I’d be recommending Santa check the insurance for his North Pole operations:

  • Products & Public Liability – Santa builds and distributes toys to children all around the world. No other business has the same reach as Santa, yet he probably hasn’t updated his public and product liability cover. If one of his overworked elves makes a defective toy, Santa could be sued for compensation as a result of an injury to that child.
  • The elves’ tools — Santa should have employees’ tools coverage under his property insurance for the extra small equipment his workers bring to the workshop. While the North Pole doesn’t get many visitors, he should check his limit provided for theft under the property form.
  • Reindeer insurance — These are expensive livestock that Santa should insure against mortality, loss of use and major medical. If Rudolph breaks a leg Santa needs sufficient cover to make alternative arrangements.
  • The sleigh — This should be covered by an inland marine policy (like a cargo truck). As Santa used the sleigh to send his toys and goods to multiple locations, Santa needs to cover these valuables all over the world.
  • Business interruption — Santa works year-round to get ready for Christmas. Losing the workshop for just one day could make a difference between December 25 and December 26. Business interruption insurance would ensure that Santa has enough cash on hand to make sure he meets his obligations, continues to employ the elves and could set up a temporary facility at the South Pole.

Just like Santa, every business has specific risks that need to be reviewed regularly by an insurance expert. Like Santa, next time you think you’re too busy to properly review your insurance, remember that your family, staff and customers rely on you whatever may affect your business!

Disclaimer

Conditions apply for each policy and the information expected from you for a policy to trigger. Coverage may differ based on specific clauses in individual policies. Please ask your broker to explain the additional benefits and exclusions pertaining to your policy.

The information provided is general advice only and does not take account of your personal circumstances or needs. Please refer to our financial services guide which contains details of our services and how we are remunerated.

social media and employees

Anti-Social Media and your employees

Employers are to expect the very best from their employees but what if employees don’t act on good faith, trust and fidelity and don’t have the best interests of their employer at heart? The number of unfair dismissal claims has increased due to employers not having appropriate policies in place to set the boundaries for employees when it comes to appropriate use of social media.

Examples range from employee rants on social media, approaching public forums to voice unfavourable information and even speaking out to journalists about their work.

Technology and access to many media forms, especially social media sites, is easily available. Employers need to protect their business against negative publicity. This can be achieved by;

  • Having clear employee contracts;
  • Media policies which prohibit employees from making public comments, or leaking information to the media;
  • Social media policies in place which clarify disciplinary action for sharing harmful information or identifying employer or company name;
  • Internal channels available for employees to voice complaints

These procedures protect employers from being ridiculed in the media and help avoid unfair dismissal claims.

When it comes to social media let’s remember that employees have a right to ‘social justice’ but is it not appropriate for an employee to engage in conduct that damages the reputation of an employer. All employees must have a fair and acceptable social presence online and in the office.

We have access to employment specialists, Employsure, who can review your workplace policies and provide advice and assistance on a range of employment policies and procedures. Contact us if you would like Employsure to help protect your business.

Disclaimer

Conditions apply for each policy and the information expected from you for a policy to trigger. Coverage may differ based on specific clauses in individual policies. Please ask your broker to explain the additional benefits and exclusions pertaining to your policy.

The information provided is general advice only and does not take account of your personal circumstances or needs. Please refer to our financial services guide which contains details of our services and how we are remunerated.

 

business interruption insurance

Why business interruption insurance matters

The majority of Australian small businesses choose to go without Business Interruption insurance – but that’s often because they don’t realise the implications and the risk they’re taking on.

While small business owners are aware of the need to insure their property, equipment and stock, most do not protect themselves from the potentially crippling impact of being temporarily out of action.

If something happens that triggers your insurance policy such as a fire or malicious damage, there is a high likelihood that your business operation will be ‘interrupted’ and this will cut your profitability – often drastically.

What is Business Interruption insurance?

In simple terms, Business Interruption covers you for loss of profits. While your income may stop after an accident, storm, fire or other ‘event’, many business expenses will continue.

A small amount of property damage will often cause a significant disruption, turning your profitable business into one that’s operating in the red. What’s more, it can be many months before you’re profitable again.

It’s not uncommon for the Business Interruption component of an insurance claim to be greater than the cost of repairing the physical damage. Many small business owners do not appreciate just how expensive it can be to have their trading interrupted – even for a short period. By the time they realise, it’s too late.

What does Business Interruption insurance cover?

Apart from lost income, Business Interruption can also cover the increased cost of working that is normally incurred as a result of the accident or event that has impacted your business.

This could be the cost of relocating to a temporary property while repairs are done, paying overtime, hiring equipment and additional temporary staff costs as you try to make up for lost time. It can also pay for advertising to tell your customers that you have just moved around the corner or that you are now ‘back in business’.

In other words, it covers costs you would not normally incur and that are necessary in order to get your business back to where it was before the event.

Indirect impact

Business Interruption not only covers interruption from events that impact your business directly, it also includes events that have an indirect impact.

A common example is if you operate in a shopping centre and there’s a fire in another part of the centre and that means customers cannot access your shop. Although your shop didn’t have the fire, your Business Interruption cover can be triggered and protect your profit.

While Business Interruption is almost universal for larger companies, the majority of small businesses in Australia elect not to take out Business Interruption insurance. Operating without Business Interruption insurance is a serious risk.

Your best business decision was to go into business. Having Business Interruption insurance is an investment worth considering as it can help put you back in business if things go wrong.

Disclaimer

Conditions apply for each policy and the information expected from you for a policy to trigger. Coverage may differ based on specific clauses in individual policies. Please ask your broker to explain the additional benefits and exclusions pertaining to your policy.

The information provided is general advice only and does not take account of your personal circumstances or needs. Please refer to our financial services guide which contains details of our services and how we are remunerated.

rockpool insurance claim

Lightning-quick recovery turns celebrity chef to broker fan

It’s long been a darling of the Sydney food scene but chef Neil Perry’s acclaimed Rockpool Bar & Grill was the centre of attention for all the wrong reasons in April this year.

A fire broke out in the kitchen during the dinner service, forcing the evacuation of more than 200 diners and staff.

Six fire crews were brought in to fight the blaze, which threatened to spread into the ducting and engulf the entire Hunter Street building. Huge volumes of water were dumped into the restaurant, causing extensive damage to its ceilings, as well as its marble-clad dining room.

“We appointed an insurance broker who identified several underinsurance concerns and gaps in coverage which were rectified immediately.”

Perry says when he first heard about the fire, it was not whether he was adequately covered that he was worried about – it was how long before he could reopen.

“For us to be closed for any length of time is difficult because it’s hard to restart the business. This is a restaurant that has 2000 bookings a week and we were actively cancelling people,” he says.

“That’s a freaky thing to do when your whole life is trying to get people to book. And it’s difficult not knowing when we could actively start rebooking people again and start saying that we were open.”

But Perry says he was overwhelmed by the attitudes of everyone involved in the rebuilding.

 

“Some of the things weren’t even quotable but they just said ‘Get the guys working on it 24 hours a day until it’s finished.’ What was also terrific was the focus on getting us in the same shape as we were before we closed.”

“Of greatest concern to client in this case was day to-day loss of business, particularly across the approaching holiday period of Easter, a highly profitable time for a restaurant.”.

Less than four weeks after the fire started, Rockpool reopened, as good as ever.

Perry says the experience upended his expectations about the insurance industry and particularly the important role an insurance specialist plays in making sure businesses have the cover they need when disaster strikes.

“You hear a lot of horror stories (but) the exact opposite of whatever I thought about the insurance industry happened to us,” he says.

Disclaimer

Conditions apply for each policy and the information expected from you for a policy to trigger. Coverage may differ based on specific clauses in individual policies. Please ask your broker to explain the additional benefits and exclusions pertaining to your policy.

The information provided is general advice only and does not take account of your personal circumstances or needs. Please refer to our financial services guide which contains details of our services and how we are remunerated.

cyber insurance

Online scam attacks becoming daily occurrences

Nearly one in every five Australian businesses are targeted by online fraudsters each day and large businesses are now taking prevention methods more seriously than just 12 months ago, according to new research.

Jeff Price, Managing Director of Experian Decision Analytics APAC, says the unprecedented levels of fraud attacks on Australian businesses is only set to increase.

“Fraud is a serious and growing issue for Australian business. Similar to other markets around the world, we can expect to see a rise in the level of fraud attacks and an expansion in the types of fraud perpetrated on Australian businesses and their customers in the coming year,” he says.

“For example, in global markets, we are seeing the growth of emerging trends like corporate account takeover fraud, which is when an organisation’s business bank accounts are exposed to a fraudster and can lead to massive losses.

“This is an issue we expect to see emerge in Australia in the near future and businesses need to be prepared to withstand these emerging and persistent threats.”

Brand reputation and revenue of businesses are also taking a hit from fraud attacks due to transactions becoming blocked due to additional confirmations for legitimate online transactions, which can result in consumers becoming frustrated and damaging customer loyalty.

“It’s critical for organisations to have the right systems and technology in place to withstand the increasing frequency and type of attacks, yet doing so can’t limit their ability to accept legitimate transactions,” Price says.

“We know that Australian businesses looking to expand into new markets can be challenged by verifying the identity and legitimacy of offshore customers and this can place pressure on their growth.”

We specialise in Cyber Liability insurance. We have access to a suite of specialist insurance policies to cover you and your business against cyber crime and the new data privacy legislation.

Through our underwriting partners, we have arranged specialist insurance policies designed to address the exposures you face from relying on the internet, email, websites, or computer programs, data and from storing private information about your clients. Contact us for more information.

Disclaimer

Conditions apply for each policy and the information expected from you for a policy to trigger. Coverage may differ based on specific clauses in individual policies. Please ask your broker to explain the additional benefits and exclusions pertaining to your policy.

The information provided is general advice only and does not take account of your personal circumstances or needs. Please refer to our financial services guide which contains details of our services and how we are remunerated.

business insurance discount

One big hitch? Industry questions discount campaign

Consumer group One Big Switch has secured hardworking Aussies a 40% discount on home and contents policies – and that can only be a positive insurance story, can’t it?

Not at all, say industry figures, who fear the campaign’s intense focus on price is dangerous and ill-advised. About 70,000 people signed up to the One Big Switch initiative, giving CEO David Issa – a former CEO personal insurance at IAG – the bargaining power to negotiate a bulk deal with Coles Insurance.

News Corp supported the promotion and both the newspaper publisher and One Big Switch – which has previously run similar campaigns on mortgages and electricity – receive a commission for every person who takes out a policy.

Mr Issa says spiralling home and contents premiums “hurt everyone” and force some consumers out of the market.

But National Insurance Brokers Association (NIBA) CEO Dallas Booth is leading the charge against the campaign.

“One Big Switch is a real worry for us. It gives the impression that you can easily reduce the price of insurance by 20%, 30% or 40%. The reality is the only way you can do that is by reducing the cover.”

The campaign is not a threat to brokers, he says, because it focuses on the direct market, but NIBA believes:

“people should be thinking carefully about their cover rather than chasing a cheap premium.

The outcome won’t be realised until they need to make a claim,” he says.

The headline figure of 40% is not as straightforward as it first appears. The discount contains “an exclusive 13% discount for One Big Switch members on top of other existing discounts”, the group’s website explains.

ICA supports competition in the insurance market a spokesman said.

“However, offers to consumers must be fully compliant with the law in terms of consumer disclosure and advice.

It is important that consumers fully understand the risks of switching from their existing insurance policies.

ICA has a number of initiatives underway or completed that directly relate to the issue of insurance affordability, and works closely with governments and customers to help them understand insurance risks and develop practical solutions.”

Disclaimer

Conditions apply for each policy and the information expected from you for a policy to trigger. Coverage may differ based on specific clauses in individual policies. Please ask your broker to explain the additional benefits and exclusions pertaining to your policy.

The information provided is general advice only and does not take account of your personal circumstances or needs. Please refer to our financial services guide which contains details of our services and how we are remunerated.

business insurance umbrella

Underinsurance the critical risk for SME businesses

Underinsurance is one of the most significant risks faced by SME’s when making an insurance claim, to the point where the very survival of a business is threatened if the full recovery of losses cannot be achieved.

There has been significant discussion on the topic of underinsurance in the marketplace for quite some time now. In 2005 the Australian Securities and Investments Commission (ASIC) found that one-in-six SME’s had not insured their properties and of those that were insured, it was for significantly under replacement value. While the information that underinsurance has reached critical levels is known, the main reasons for underinsurance are still to be resolved.

THE PROBLEM OF UNDERINSURANCE

Many small business owners lack an understanding of the consequences for their business in the event of a major interruption to trading such as a fire, flood or other serious adverse event. A review of a sample of 2,000 Australian small businesses revealed some common threads in relation to underinsurance and why there is a high incidence of underinsurance amongst Small to Medium Enterprises (SME’s).

The 2001 and 2004 ABS Small Business Survey estimated just under 200,000 uninsured small businesses were operating in Australia. The one-in-six figure does not account for businesses that were underinsured or not appropriately insured. Cameron Research 2006 stated that of these businesses:

  • 13% did not have fire insurance
  • 65% did not have businesses interruption insurance, and
  • 18% did not have burglary insurance.

Up to 70% of small businesses affected by a major loss do not recover.

With a combination of planning, professional support and adequate BI insurance cover, businesses could be well prepared to deal with unforeseen circumstances and the resulting consequences on business continuity.

Over the past few years, industry bodies such as the ICA and ASIC have tried to educate SME’s on being properly insured. However, the campaigns have had little impact on SME business insurance levels across Australia.

CAUSES OF UNDERINSURANCE

The most common driver of underinsurance is the perceived high cost of insurance premiums. However, this can be largely dispelled by the fact that small business spending on insurance represents less than 1% of their total expenses. The decision can be influenced by an inability on the part of the insured to fully understand the policy document and in some cases this can be exacerbated by the policy holder’s advisors.

A national survey of 1,200 consumers found that 87% believed it was the policy holder’s responsibility to decide on their level of insurance, 7% nominated the insurer and 5% believed a professional valuer should advise on the correct level of sum insured.

Disclaimer

Conditions apply for each policy and the information expected from you for a policy to trigger. Coverage may differ based on specific clauses in individual policies. Please ask your broker to explain the additional benefits and exclusions pertaining to your policy.

The information provided is general advice only and does not take account of your personal circumstances or needs. Please refer to our financial services guide which contains details of our services and how we are remunerated.

business insurance competition

Competition controls insurance premiums

The increased insurance capacity and competition that was a feature of the global market last year is showing no signs of easing, according to reports.

There is a flat-to-lower trend in premiums for Australian lines such as property, general indemnity and directors’ and officers’ insurance, with exceptions for less-attractive risk areas.

In property, rates have come under pressure following a “massive drop-off” in worldwide natural catastrophes following the spate in 2010-12. A rise in capacity fuelled “unprecedented” competition in the global property market last year.

The market has also faced pressure from businesses taking on more risk and opting for lower premiums and reduced cover, as the uncertain economic environment encourages cost-cutting drives.

Ex-Tropical Cyclone Oswald was the only major disaster to affect Australia last year amid a benign global environment. The Insurance Council of Australia (ICA) says flood and storm damage caused by Oswald in NSW and Queensland topped $1 billion.

So far this year ICA has declared catastrophes for Perth bushfires, which have cost $15 million, and Cyclone Ita, which crossed the Queensland coast earlier this month.

In general liability, rates have hardened for bushfire and offshore energy exposures, while intense competition and surplus capacity in other areas is keeping premiums flat to lower.

Capital investors are seeking the Australian insurance environment as a safe haven for their investments and are entering the market in large numbers. This has extended the soft market conditions and these circumstances won’t change until the capital flow is tempered.

Such competition means no one wants to be the first to increase rates, and these conditions are forecast to remain much the same over the next six months to a year.

Disclaimer

Conditions apply for each policy and the information expected from you for a policy to trigger. Coverage may differ based on specific clauses in individual policies. Please ask your broker to explain the additional benefits and exclusions pertaining to your policy.

The information provided is general advice only and does not take account of your personal circumstances or needs. Please refer to our financial services guide which contains details of our services and how we are remunerated.

PSC Connect covers Australia

PSC Connect launches its new website today as part of it’s business strategy to grow the opportunities for Insurance Brokers around Australia to realise their dream of running their own insurance broking business.

PSC Connect forms part of the PSC Insurance Group operation and operates under its own Australian Financial Services License (AFSL 344648). It’s business objectives and strategies are:

  • To develop a significant network of Authorised Representatives operating throughout Australia.
  • To manage the Compliance, Administration and Support services
  • To provide the IT platform and associated financial services
  • To provide regular training support through workshops enhancing the image and professionalism
  • To deliver quality insurance products, schemes and facilities to assist in new ‘lead generation’
  • To provide access to marketing and communication material for business development and promotional campaigns
  • To provide access to member organisations including NIBA, Steadfast and Wells Fargo Global network.