It is no secret that small to medium businesses play an integral role in the economic growth of South Africa. The problem is that the size of many of these businesses make them vulnerable as they are often faced with numerous challenges.
Unplanned crises will and do crop up from time to time, including everything from fraud to theft, fire and flood, plus the costs are compounded by the failure to ensure that they are adequately covered by their business insurance – you need to ask yourself the question – do you have the right insurance cover should something go wrong in your business.
Here are five key hints and tips when looking to insure your business:
- If you are prepared to pay a higher excess the chances are that you will be able to negotiate a more affordable and cost-effective insurance. This is where your broker will enter the picture – ask for advice as you will also need to remember that there will always be an impact on your bottom line regarding your cash flow – this will be especially the case if you suffer a number of losses in a short period of time.
- It is essential that you proclaim all the pertinent data when insuring your business – especially those tiny little details you don’t think are important. Declaring all the risk-reducing actions you have applied will also indicate that you are serious about your business and will assist you in discussing a better premium.
- When taking out business insurance it is great idea to act as though you have no insurance – this is because insurance should be used for those catastrophic situations only that are difficult to either predict or to avoid. In other words your business insurance is a buffer for large calamities and not small little incidences.
- By taking precautions you will be able to avoid certain issues – in other words prevention is far better than cure. Installing appropriate security and fire precautions is an obvious step in the right direction.
- Taking time out to identify all exposures to your business is essential – do an inventory with your broker or your intermediary so that they have a good idea what kind of business you conduct and therefore will be able to pinpoint your vulnerabilities that you might not be aware of.
Under-insuring your business property or assets can have a detrimental effect on your financial wellbeing – ensure you have the proper cover for your business.