Question Mark - questions to ask yourself when considering your business insurance

What would happen if?

As business owners and directors we need enquiring minds. We need to think about what could happen to our business if something that we control, can influence, or have no say over whatsoever changes. We need to ask ourselves the “what would happen if?” questions.

For example if we own a 50p shop we need to think about what would happen should a 49p shop open next door and how we would react? We need to think about how technology is changing, how this will affect the way we transact business in the future and how demand for our products and services will change. I heard just today that 50% of smartphone owners no longer own an alarm clock and 40% no longer wear a watch. If we were clock or watch makers what would we do?

We spend a lot of time thinking about the positive results that could emanate from the changes we could make within our businesses. But we do also need to think about the risks that the business faces from a number of sources and decide what action if any we are going to take to try to eliminate, control or mitigate these risks.

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Insurance forms a part of this risk management process. When you are reviewing your insurances you need to employ the same enquiring mind that you use when looking at other aspects of your business. Read the policy wording and decide whether it really does provide the protection you need and make sure you ask yourself the “what would happen if” question. This will help you to decide what you need to insure and the level of cover you need.

Challenge the policy wording and ask yourself whether the cover the insurance company is providing is sufficient for your needs. Back in 2007 following the terrible floods we experienced here in Gloucestershire the water was turned off for a fortnight. Most business interruption insurance policies contain an extension which provide some cover for loss of gross profit following the utility supply being disrupted due to the operation of an insured peril. Unfortunately for some businesses the inner limits applied to their policies (sometimes as low as £25,000) were nowhere near enough to cover their losses. They had either not foreseen that such a thing could happen or had assumed that they would have enough cover.

It goes without saying that part of our role as an insurance broker it to work with you, to understand your business, discuss the risks you face, to ask you those all-important “what would happen if” questions and to put in place for you a comprehensive insurance solution.

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