Should you renew or review your insurance policies when they are due?

Many business owners simply renew, rather than review, their annual insurance policies, most probably because it ticks one more box in their already busy schedule. The problem is however, that renewing your policies without reviewing them can cost you money in both the short and the long term.

In the short term, you may be paying for cover that you no longer need and ignoring cover that you do need. In the long term, when you make a claim on your policy, you might be knocked back because you didn’t inform the insurance company of certain changes in your business or because you are underinsured.

Let’s take a look at the best way to review your existing policies, so you can make sure that you reduce your business risk and maximise your cover.

Have your circumstances changed?

As soon as anything changes in your business, you need to inform your insurance company. You might be surprised at some of the seemingly minor changes that can affect your policy and your premiums, so here are six questions you need to ask yourself before you renew your policies this year.

  1. Is the description of your business on your policy still relevant? If your business activities have significantly altered, then this needs to be updated on your policy.
  2. Has your business moved its location? The location of your physical store can make a difference to your premiums, so always inform your insurer when you relocate.
  3. Have you purchased, sold or disposed of any assets? New assets need to be covered in your policy and assets that your business no longer owns should be removed from your policy. The last thing you want is to make a claim and find that the asset was not covered under your policy!
  4. Have you renovated your building, office or retail store? Changes that increase the value of your business can make a difference to your premiums, so always inform your insurer, just in case.
  5. Have you installed a new alarm system or employed security guards? Added security can reduce your premiums, so this is another instance when you need to pass this information on to your insurer.
  6. Have you updated your vehicles? Have you purchased or leased new vehicles? Maybe you have tinted the windows or added a towbar, replaced an outdated A/C unit in the refrigerated truck or installed GPS tracking in your delivery vans? All of these changes can make a difference to your premiums and to any claims you make in the future.

If in doubt, it’s always best to talk to your insurer and keep your policies updated at all times.

What other questions should you ask?

Keeping your policies updated reduces your business’s overall risks, but there other questions about your cover that you need to ask during your review, for example:

  1. Are there any exclusions or limits on your claims and are these suitable for your business today?
  2. What are your excess payments? Is it appropriate to increase these payments and reduce your premiums?
  3. Is your policy’s payment schedule still suitable or would you prefer to change this schedule?
  4. Does your current policy still suit your business needs?
  5. Are you happy with the service from your current insurer?

The safest approach is to review your policies before renewing them and if in doubt, contact your insurer to clarify any points of concern.