Business owners are finding the effects of rising inflation combined with restrictions on bank borrowing lead to major financial problems.
If sales are falling, the only way to maintain a healthy bottom line or to minimise losses is to look at expenses.
One cost that comes in for scrutiny is business insurance as employers.
Small businesses are vital to the economy – around 5 million firms employ more than 23 million workers – but they often receive the least help and poorest advice.
Checking out the value of insurance to a business starts with benchmarking the need.
Instead of blindly renewing an annual policy, look at the cover and disregard the cost for now.
Commercial insurance should protect any business – from a sole trader to a large company – from eventualities that could stop or disrupt trading.
It makes sense business owners and managers should list these eventualities – like the failure of a supplier, natural events like floods, or unexpected occurrences like a fire or riots that could put a trader out of action for weeks or months.
Someone who has a thorough, detailed knowledge of a business should assess the risk – not an insurance broker or salesman.
The risk could include liability to customers, the consequences of poor professional advice or more tangible problems, like employees handling dangerous materials or operating complicated machinery.
Once the business has a risk list of issues that need cover, then approach three brokers for quotes.
The key is to speak to independent brokers who can make a ‘whole of market’ search for a policy.
An independent should have no restrictions on approaching insurance providers – banks, tied brokers and some comparison often offer a limited range of providers who may not offer the best cover at the right price.
Selecting the best priced business insurance is not about choosing the cheapest cover, but by finding a provider who will tailor a policy as a best match to the assessed risks.