Online Insurance Not Providing Enough Cover

Online Insurance Not Providing Enough Cover

Online Insurance Not Providing Enough Cover for Businesses, Reveals Broker
4 July 2021

Businesses are trying to cut costs by getting cheaper insurance from online providers but instead they are being left with cover that doesn’t match their needs.

Insurance Broker and Principal of WA Insurance Brokers Peter Newbound said that as businesses grow their insurance needs become more complex.

“Offering a quick fix online is not the way to go,” Mr Newbound said.

“Many people actually don’t reveal everything to an insurance company in order to get a cheaper premium, but if something goes wrong and you’re not covered you’ll realise how foolish that approach can be.

“A good broker should really get to understand the needs of the client so that he or she can share expert knowledge for the benefit of the client,” he said.

“So many companies think they have the cover they need but when it comes time to claim they are discovering that what they actually have is quite different.”

The biggest traps businesses face result from:

  • Moving to international trade: standard cover only includes Australia, if you move to international trade you need to redress your insurance
  • Failing to understand what is included in ‘standard exclusions’: these can include any work on wharves, marine craft, close proximity to railway infrastructure, proximity to airports, work within a terminal building
  • Fine print that is left unscrutinised: the use of contractors and sub-contractors is considered a standard exclusion within the Broadform Public and Products Liability Policy
  • Businesses assuming all similar policies contain the same elements: different insurance companies may offer different cover for the same type of insurance

“Understanding your business insurance is not easy and I don’t blame people for skimming or assuming, but really insurance is a form of risk management and you can’t afford to do it half heartedly,” Mr Newbound said.

“Usually it takes a claim before shortfalls in insurance come to light and by then it is too late,” he said.

“You need your insurance broker to really understand your needs and the needs of your business in order to get the right insurance and that just isn’t going to happen if all you do is fill in an online form.”

“You need to speak to your broker and they need to listen.”

Mr Newbound runs WA Insurance Brokers which specialises in Business Insurances.