Critical Business Insurance - Re: Think

Insurance is critical to help grow a business.

If a business can proactively manage its risk management and insurances it provides certainty and ultimately helps companies achieve their goals. In the second part of the series we look at how business owners should re think how they manage the risks their businesses face.

Think Strategically - Protecting today

Insurance can be seen as a tactical purchase, with the decision on what insurance to buy (and from whom) sometimes coming down to cost and minimum compliance, as opposed to the quality of the cover. This is particularly true in the current competitive economic environment, where businesses are squeezed and cost savings need to be made.

This approach, while appearing expedient in the short term, ignores the fundamental value of good quality insurance and its strategic importance in building resilience for the future.

Closed for good. 805 of businesses close after a major loss

Think Strategically - Preparing for tomorrow

Understanding where a company wants to be in the future, identifying risks that might stop it getting there and working with advisers and insurers to get the right risk management, transfer and mitigation strategies in place, all help build a resilient and sustainable business.

To realise this ambition, businesses should be asking their advisers and insurers to look beyond the existing insurance and examine the short and long term objectives to fully understand the wide range of risks it faces.


One of the recurring themes of this guide is that, when purchasing business critical insurance, companies should negotiate their policy based on its efficacy - it's "fitness for purpose" - not on price alone.

A recent review of claims handled for small and medium enterprises ( SMEs ) noted " a gap between the claims service received and the SMEs expectations". It went on to highlight "a number of instances where the sum insured was inadequate to cover the loss". This problem is entirely avoidable, but will require companies to understand that not all insurance is the same.

As with most buying decisions, you get what you pay for. Remember, having an insurance policy that will pay out as and when you expect it is the most important criterion. Unlike large corporates who have access to in-house risk managers, it is essential for SME business owners to have access to professional advice before authorising any insurance covers.

If you'd like to get the right advice for your business get in touch with us today and we'll partner you with an experienced adviser. 

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