This Steadfast article first published on Steadfast.com.au
Small business owners tend to be born optimists with little inclination to think about what could go wrong. That’s why it pays to have an insurance broker in your corner to safeguard what you’ve worked for.
Paul Harrison’s family-owned shoe shop in Sydney’s Neutral Bay has operated out of various locations for more than half a century. It’s used insurance brokers for the past 35 years.
“When I came on board, we already had insurance but not at the level we needed,” says Harrison. “Most of the insurance we had was good, but it took time. If we made a claim, an assessor would come along; then he’d send you forms to fill out before repairs could begin. All that time you’re not trading.”
Save yourself time
Anyone who has compared car, home or health insurance policies to try to find the best deal knows how time consuming it can be. Choosing a business insurance package is even more complex because of the range of risks requiring cover.
A broker will not only save you time sourcing the right policy, they can also save time and money if you need to make a claim.
That was Harrison’s recent experience with his long standing Steadfast insurance broker.
“We had a leakage from the residential unit above our premises that ruined our ceiling, stock and floor. With rent and wages to pay, you can’t afford to be out of business for two months. Our insurance broker was onto it straight away. We were able to replace our flooring within two days and probably missed five days’ trading in all”.
Utilise your broker’s experience
Small business owners are great at what they do, whether it’s running a café or a consultancy. But they are rarely insurance experts. “What they may not understand is the broad range of risks they face,” says Dallas Booth, chief executive of the National Insurance Brokers Association (NIBA).
A broker will help identify the risks your business faces, then get the insurance package that matches those risks. “There’s no point buying a business package off the shelf if it only covers some of your risks,” says Booth.
“I don’t think you can do that on your own. You may think you know what can go wrong but you never realise how much [an adverse event] impacts on your business going forward,” says Harrison.
Access better deals and cover
Buying the wrong insurance cover cheaply can be expensive, whereas paying a bit more for the right cover can save you money. In some instances, an insurance broker may even be able to negotiate a better deal in terms of both price and coverage.
“A broker will find the business package that covers their client’s risks at the best value for money,” says Booth.
Harrison says his broker also keeps the business up-to-date when new policies become available and advises them when their assets need upgrading. “The first time we made a claim, we didn’t have computers. They said a computer stocktake would make future claims easier, so we installed computers with software to substantiate claims quicker.”
“If you have to make a claim, it’s good to have someone on your side.”
Back-up when you need it
Your insurance broker works for you, not the insurer. A good broker can prove invaluable if a claim needs to be made, by co-ordinating the claims process and knowing what is and isn’t covered by your policy.
Harrison says his footwear business averages an insurance claim every five years. “A broker is definitely useful. They were able to inform us which of our policies we could claim on and get things moving quickly.”
Behind every Steadfast insurance broker is the power and wealth of knowledge of the Steadfast Group. If an insurer turns down the initial claim, Steadfast Group can determine, based on the facts of the claim, if there are grounds to go in and provide additional strength. “If you have to make a claim, it’s good to have someone on your side,” says Booth.
It’s worth investing some time and effort into finding an insurance broker with a good reputation. One who you trust and are happy to have a long-term relationship with. “As you grow, they grow with you”, says Harrison.