Underinsurance: Are you Risking It?
If your business is underinsured, the company assets are valued and insured for less than their true worth. This leaves your business vulnerable should the worst happen. Significant underinsurance would result in compensation less than the true value and could devastate your organisation.
Why are companies underinsured?
Owners believe that a major loss event will never happen to them
Failure to properly review their cover regularly despite any changes occurring
To save money on premiums
Lack of understanding on the covers available or their intended purpose
Not only does deliberate underinsurance for the above reasons leave your business exposed but insurers can also void cover on the grounds of misrepresentation or non-disclosure, making it more expensive or even impossible to obtain future cover for your business.
Think of it this way... A broken umbrella won't protect you from the rain and underinsurance won't protect you against a claim.
Policies Regularly Underinsured
Buildings – Business and Property Owners often consider the market value of a property and not the actual rebuild value. We recommend that a valuation is carried out at least every 5 years to ensure accurate cover is maintained.
Machinery and Plant – Failing to frequently update a list of all machinery and plant could mean there are gaps in cover when making a claim. Regular records and adjustments to sums insured are simple ways to ensure sufficient cover.
Cyber Liability – Data breaches are an ever-increasing danger to businesses of all sizes. It is a rapidly evolving type of cover that is often overlooked due to it’s infancy but could be the most crucial in a virtual world.
Management Liability – Senior Managers and Owners often fall victim to mistakes caused through oversights or employee claims. When a business is held liable, it can cost a great deal of money and can have damaging effects. This cover can often be overlooked as part of a review due to lack of understanding compared to general covers.
Contact the team at Addingstone Insurance on 0345 862 2727 if you have any further questions and we will be happy to assist you further.