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Are your business risks and assets the same as they were a year ago? As businesses adjust to changing conditions, insurance renewal is an opportunity to review how much of what type of cover you'll need over the coming year.
Securing optimal protection and insurance renewals requires preparation, expertise and strategic considerations. This is especially true if both the business and insurance markets have sustained significant pressure and change
To achieve optimal business insurance protection renewals are best managed in a structured and strategic way. Having the services of a business insurance broker in the renewal process provides expertise, support and advice for accessing and negotiating insurance markets and cover, and obtaining the optimal cover.
Key steps in working to achieve optimal business insurance renewals for medium to large businesses are outlined below.
Business and broker collaboration to review and update your business risk exposures and specific changes, and also considering key risk concerns and future needs, provide the key foundations to shaping a fit for purpose insurance program.
For medium to large businesses, building in a longer lead time to prepare your insurance requirements 3-6 months ahead enables preparation of detailed supporting information and allows your broker to properly market your insurance program to, and negotiate with, potential insurers.
Consider how your business has changed: have you expanded or reduced your locations, added or cut staff numbers, outsourced some functions or invested in or divested yourself of plant and equipment? Do you need additional cover for new exposures and are there some areas that are no longer relevant? Think ahead about future business scenarios or plans, are there different insurance and risk needs to support?
Changes to review for business insurance needs would typically include
Conducting an up to date audit of your operations and assets helps clarify the policies and cover you require now and over the coming year.
Insurance selection involves two broad areas of consideration: insurance policy selection and choice of insurers. Choosing which insurance policies — and the provisions and limitations of the cover, including deductibles that may provide pricing flexibility around premiums and excesses, as well as the levels of coverage — can enable greater flexibility and a more customised insurance program to suit low or high risk appetites across the different risk areas that apply to your business.
The process typically might include
Looking at choice of insurers involves considering the range suitable to support your business risk needs, their offerings and terms of cover, underwriting position and risk appetite. The risk assessment approach by different insurers varies, and it's important to select the right insurers for your business needs.
Large organisations and those with specific or hard to place risks benefit from broker access to a broad offering of insurers from both local markets and overseas. This can help achieve capacity for some types of risks that may be difficult to place with local Australia-based insurers. Gallagher brokers may provide options from global markets to offer alternatives that meet your specific insurance requirements.
Demonstrating proactive business risk management practices and providing information about how you actively manage the risk exposures in your business operations is key for insurers in assessing your business risk exposures. Insurers can be selective about the risks they are willing to support, and want to see detailed underwriting information. Providing evidence by documenting your business's risk control processes, supply chain management and regular risk surveys will work towards improving your risk profile.
Your broker's input on selecting business risk information to supply, advising ways to minimise your risk exposures and presenting your risk management and insurance needs to potential insurers in a constructive way helps achieve a positive outcome.
How much your renewal will be affected by market conditions will vary depending on your risk profile, claims record, approach to risk management and your broker's capability, but businesses should be prepared for renewals changes in premiums and other aspects of their insurance renewals.
At Gallagher we work with a large variety of businesses, with unique risks, challenges and circumstances, including many businesses with hard to place risks. As a leader in risk management, we provide expert guidance in meeting insurer expectations through the renewal process, to access cover that achieves confidence in business risk protection solutions.
Gallagher provides insurance, risk management and benefits consulting services for clients in response to both known and unknown risk exposures. When providing analysis and recommendations regarding potential insurance coverage, potential claims and/or operational strategy in response to national emergencies (including health crises), we do so from an insurance and/or risk management perspective, and offer broad information about risk mitigation, loss control strategy and potential claim exposures. We have prepared this commentary and other news alerts for general information purposes only and the material is not intended to be, nor should it be interpreted as, legal or client-specific risk management advice. General insurance descriptions contained herein do not include complete insurance policy definitions, terms and/or conditions, and should not be relied on for coverage interpretation. The information may not include current governmental or insurance developments, is provided without knowledge of the individual recipient's industry or specific business or coverage circumstances, and in no way reflects or promises to provide insurance coverage outcomes that only insurance carriers' control.
Insurance brokerage and related services to be provided by Arthur J. Gallagher & Co (Aus) Limited (ABN 34 005 543 920). Australian Financial Services License (AFSL) No. 238312