Does your insurer have enough information about your business?

Your business is your income, and most likely the income of others, so putting in the right measures to protect it should be a priority. And while you are likely to have business insurance to mitigate for any bumps in the road, interruptions, or unexpected losses, are you sure you’ve played your part in providing your insurance provider with sufficient details regarding your business? 

Failure to comply with “full disclosure” means if you need to make a claim and it transpires there is critical information missing, you may not get the payout you were expecting (and possibly a full rejection) – and you’ll also face a premium price hike when arranging your renewal terms. 

What business details do insurers require?

Being negligent when providing full business details equates to being underprepared. And that in turn can leave you underinsured – a state that no business or individual should ever be in. So, before we look at the consequences of this, what information needs to be shared with a potential insurer?

The below list is the standard, although different insurance companies or brokers may ask for some of this or perhaps more, so make sure you have all of this information to hand:

• Annual turnover 
• Employee wages 
• Your personal business income 
• Date you started trading 
• Number of employees/staff 
• Value of stock and contents (if applicable) 
• Previous claims or incidents at the property 
• Business address
• Building structure and materials 
• Current insurer (if applicable) 
• Current renewal price (if applicable)

The cost of not providing full disclosure on your business

The biggest loss and cost is likely to be a financial one. Having a claim rejected following a warehouse fire, office flood, cyber-attack, or theft of goods may cripple your business permanently. 

Perhaps you assumed you performed your due diligence and research by finding a quote via a price comparison site which, on reflection, only asked some basic questions, rather than the long list we’ve provided above? Whatever the reason, if you’re caught in the situation of being underinsured due to non-declaration of details, this is what you’re likely to face:

• Claim rejection: If you don’t tell your insurance provider all the correct details at the time of securing your business insurance policies, and you do need to make a claim at some stage, this may well be rejected. Not only will you not get the insurance payout, but you’ll have to find the money and resources to fix the issue yourself. 
• Policy cancellation: If your insurer discovers that information is incorrect or incomplete, your policy/policies may be cancelled and voided. In addition, even if you didn’t know you were doing something wrong, you face issues of suspected fraud. 
• Renewal becomes difficult: A voided or cancelled policy means that your insurer is likely to be hesitant to even talk about renewal terms – and alternative providers will have access to information about this situation so may also refuse terms, leaving you without cover and uninsured.
• Increased premiums: At first, you might be feeling pleased that you have an affordable premium for your business insurance, but this is potentially only as a result of submitting limited or incorrect information. Once this comes to light, not only will it be a nasty shock that you’re not as covered as you thought you were, but you’ll need to arrange the more comprehensive cover for now and face a significantly increased premium in the future.

Talk to a broker

All of this can be avoided if you partner with the right insurance specialists in the first place. When you speak with an insurance broker such as Howden, they’ll ask you all the necessary questions upfront and gain true insight into your business by talking to you directly. This way, not only will you not be at risk of underinsurance or omitting to submit key information, but you’ll also have an actual human being advising you on what business insurance cover you really need, and not the stuff you don’t.

And while you may have an initial concern regarding the cost of this advice and guidance, weighed up against the risk of chancing it with a provider you settle with via a comparison site that may not actually protect you, that upfront monetary outlay pays for itself.

Honesty delivers the best policy

In summary, we suggest that you always try and over-deliver on business information from the get-go. Any absence of detail, accidental or otherwise, is simply…unwise. This includes any past claims – successful or otherwise. 

If you want to put yourself and your business in safe, specialist hands, talk to one of our team today via the buttons below.