Are you over-insured?
Small and medium-sized enterprises (SMEs) are the backbone of the UK economy. According to government statistics, businesses of this size account for over 99% of all UK businesses and employ over 16 million people. Naturally, it's important for these businesses to have appropriate insurance coverage to protect themselves against risks. However, some SMEs may find themselves over-insured. This means that they’re paying for more insurance coverage than they actually need. In this blog, we'll explore whether your UK SME business is over-insured or not.
It's critical to understand what insurance coverage is essential for SMEs. While every business is different and will have unique insurance needs, there are certain ‘standard’ types of coverage that most SMEs require. These include employer's liability insurance, public & products liability insurance, professional indemnity insurance, and property insurance. Depending on the nature of your business, you may also require other, additional types of insurance coverage, like cyber insurance.
The danger of being over-insured lies in the fact that it can lead to businesses paying more in premiums than they need to. This will impact cash flow, reducing the business's ability to invest in growth or make any improvements necessary. Additionally, some businesses find that they’re paying for insurance coverage they will never need, which is a total waste of money.
One of the core reasons that businesses end up over-insured is that they have not reviewed their insurance needs for some time. It's important for SMEs to regularly review their insurance coverage to ensure that they’re adequately covered for their risks. For example, if a business downsizes or shifts operations, it may no longer require the same level of coverage as previously held.
Another reason businesses find themselves over-insured is that they’ve been sold insurance coverage they don't need. This happens when an insurance broker or agent is focused on making the sale, as opposed to providing the right level of coverage for that business's needs. SMEs need to find a trusted insurance broker or agent that they can work with; a broker that takes time to understand the business need and then recommend appropriate coverage.
How can SMEs make sure that they’re not over-insured? Firstly, we recommend reviewing your insurance coverage regularly, to ensure that you’re not paying for more than you need. This can be done by working with a trusted insurance broker or agent that will advise on your coverage needs. Secondly, it's important to fully understand the risks your business faces and tailor your insurance coverage accordingly. This can involve seeking advice from industry experts or seeking out specialised insurance policies to meet your unique needs.
With our comprehensive range of insurance products, including employer's liability, public liability, professional indemnity, and property insurance, we will ensure your business is protected against a wide range of risks. We pride ourselves on our personalised service and support and will help you navigate the complex world of insurance with ease.
So why choose Broadsword Risk? Our competitive pricing, transparent policies and exceptional customer service make sure that you and your business needs come first. Our brokers are always on hand to answer your questions and we support you whenever you need it. We believe in building long-term relationships with you, working closely together to ensure that your insurance coverage remains appropriate and up-to-date as your business evolves.