Let’s face it, no one wants to pay more than they have to. Whether this is something as small as a cup of coffee or as important as business insurance, saving money brings with it a certain sense of achievement.
In fact, it can be particularly satisfying to save on your insurance. Your policy is like an invisible safety net; if you’re in business it is nice to know it’s there. However, if you aren’t claiming on it, you may be annoyed at the expense and be tempted to reduce covers to lessen the premium.
This is counterproductive, of course, but also understandable. Working without insurance, no matter the size of your business, is a losing game. As Murphy’s Law states, whatever can happen will happen, and the instant you remove your safety net will no doubt be the moment you fall.
That’s not to say you can’t reduce the cost of your business insurance policy to make it more palatable. There are plenty of ways you can work with your insurance broker to to do so without making destructive changes, giving you that sense of satisfaction – and safety – without the needless risk.
Here are four ways to do just that:
How many insurers can you name? Perhaps only your own, and a handful of others.
However, Australia is a hotbed of insurance providers. As well as our own local insurers, there are global ones to consider, each purporting to be a specialist in a certain field of insurance and with products at different prices.
Comparing business insurance is a tried and tested way of identifying, identical (or even better) products and knocking down your policy cost in the process, without lessening the strength of your cover.
Sounds good, right? But who has time for that?
This is where your insurance broker comes in handy. With the right networks, know-how and methods, your broker’s job is to understand the market and scour the insurance landscape on your behalf, sourcing the right covers at premiums negotiated for you.
Mix and match
There is a misconception that using the same insurance provider for all your cover needs reduces the overall cost of your policy. This is not always so.
Policyholders can compare providers for specific products. So if you feel your professional indemnity insurance is a little pricey, but are happy with your business interruption cover, there’s no need to stay dissatisfied.
In this way, and by valuing quality as well as cost, a business owner can create a really strong – and price effective – insurance policy.
Consider an excess
If you are happy with the current cover provided, you can often have an excess (or an increased excess) placed on claims you make. While this means you pay a certain amount of your insurance claim costs, it also allows you to pay a lower weekly/monthly/annual premium.
For example, if you agree to cover a certain amount of your commercial vehicle insurance claims, you will likely be able to pay lower premiums each term than a business that has zero excess.
This is a good arrangement if you feel your policy is already well suited to your company, but struggle to afford the payments.
Look into your needs
One of the most foolproof ways to cut down the cost of your business insurance is to simply get rid of the coverage you don’t need. If you have not looked at your policy terms for some time, it may be likely that your company has outgrown them.
You may be paying for unnecessary cover in areas that you may no longer require, leaving you somewhat out of pocket.
Your broker’s role is to assist you in identifying and protecting the parts of your business that need them most, and trimming the fat from your existing policy to lower the overall cost.
To discuss this and much more, contact your local MGA office and speak to an expert today.