Archive for Business Interruption

UK Insurance Companies Pay Out Millions In Metal Theft Claims

The demand for raw materials, especially metals for industry in the emerging BRIC economies of Brazil, Russia, India and in particularly China, coupled with a recession in the UK has created a massive nationwide crime wave of metal theft that is costing UK insurance companies millions of pounds per week, according to a press release from the ABI (Association of British Insurers).
All types of metal are being stolen and each theft creates a series of public hazards and property damage.

Popular theft includes the lead from off of church roofs, cast iron drain and manhole covers from the streets, railway track and copper cabling from permanent way and sidings, all types of electrical cabling from business premises or unoccupied buildings. Nowhere is immune to the theft and reports have been made of damage from all corners of the country.

A spokesman for the ABI said that metal theft had doubled in the UK in the past five years with now around 1,000 reported police and insurance claim incidents each week.

The disruption the crime causes is estimated to cost the UK economy about £770m each year. Much of this is paid out in claims for business interruption.

The ABI report said metal theft was an “ever-present threat” and it will meet the UK Government and British Transport Police to debate the issue.

Nick Starling, the ABI’s director of general insurance, said: “Metal thieves are putting lives at risk, causing expensive damage and massive disruption. “This is why we are working with the Government to crack down on metal thefts”.

The ABI states that each week:
1,000 metal thefts occur – double the number of five years ago
300 tonnes of metal was stolen per week, which is the equivalent of 300 cars
The UK economy loses £15m in replacing stolen metal, compensating victims and disruption
Train services are delayed by 117 hours after cable thefts
23 churches are attacked

Example of recent thefts include a range of attacks from the small to the large-scale organised crime gangs.

A £500,000 sculpture was stolen  from a park in London by a few individuals while a large gang stole a train with two trucks of scrap metal, driving it down the line and emptying the metal into lorries at the track-side before making off.

The ABI support legal action which will make it harder to resell stolen metal and much tougher penalties for offenders and are calling for scrap dealers and metal recycling industry, which is  is worth an estimated £5.6bn per annum and employs 8,000 people in the UK, to be registered and cash payments to be banned.

Chris Coates of UK Commercial Ltd insurance brokers warns businesses, especially those at risk to take extra precautions to prevent theft and to minimize any disruption caused which often amounts to the biggest loss.

“All businesses large and small should carry out their own internal risk assessment as to the likelihood of suffering from a metal theft crime.”

“The theft of  a roll of lead cladding from the roof of building housing a computer repair business, could be devastating if it occurred on a wet stormy night. Often extra preventative security measures such as denying access to the roof through for example the application of anti-climb paint, is a simple, effective and cheap method of deterring metal theft.”

Business Insurance Quotes Caveats

Disclose All Material Facts When Comparing Business Insurance Online

If you are in business you will want the re-assurance that the business insurance policy you bought is actually going to cover your losses and pay out in the event of a claim.

It is an unfortunate fact that when then worst happens and your business makes a claim on the policy, that either the offer from the insurance company is nothing like what you lost or expected to receive to get the business flowing again, or worse still that the claim itself is contested or repudiated.

The majority of these problems occur at the proposal stage which translates in modern parlance to the quote stage.

All the information a business supplies when applying for business insurance quotes online, will eventually become part of the policy contract. All insurance contracts come under a class of legal contracts subject to the rule of ‘utmost good faith’ and this requires full disclosure of material facts. If mistakes are made when filling in online forms and comparing business insurance quotes, then this will cause problems for the policyholder when a claim is investigated.

The FSA is already investigating the use of default data in form fields for personal lines products sold online and the potential for these contracts to be missold. We asked Insurance Blogger to have a closer look at this increasingly occurring problem that will only be exacerbated by the increased popularity, particularly for small business insurance, of using an online business insurance supplier.

Get Your Business Details Correct When Applying Online For Business Insurance Quotes

Applying for business insurance quotes online has become a simple process and many of the five million small businesses in the UK are purchasing cover this way.

It is now easy to get both business property and liability insurance quotes and buy cover online from numerous outlets including commercial insurance brokers, direct business insurance companies and business insurance price comparison sites.

Every type of business cover can be bought online if your company does not employ more than fifty employees, and even these larger cases are handled today by helplines and callback facilities.

The practice of buying cover online is particularly of interest to small business and self employed tradesman, often working from home. An hours research and comparison of business insurance quotes could save a small business a significant amount in annual premiums.

There are however sometimes major problems that arise for businesses that buy online, further down the line, if they are unfortunate enough to have to make a claim against the policy.

The majority of the problems that can delay a payment or repudiate a claim, occur because of the information about the business that was supplied or given, when first getting a business insurance quote.

It is therefore imperative when getting quotes online that the correct information about the business is supplied.

In particular clams will be questioned when the business is either misrepresented by the information supplied or there has been an alteration to the business activities which was not declared when getting the quotes.

Misrepresentation can be either deliberate to avoid paying additional premiums or unintentional, however neither is an excuse and will be penalised.

Deliberate misrepresentation is for example a builder applying for builders liability insurance quotes,who uses heat and works at height but who declares he only works on single storey extensions. Another example would be a company applying for employers liability who only declare half of the workforce.

Unintentional misrepresentation is far more common but can still lead to disappointment when making a claim.

Get your sums insured right

The most common mistake made by business men and women when applying for business insurance cover online, is to declare the value of property at a level less than its true worth. This could apply to declared sums insured for commercial buildings and or contents insurance.

If the declared value of the sums insured is less than market value or the cost of re-instatement, whichever is applicable to a particular policy, then the claim will be subject to what insurance companies call ‘Average’. All properties will be subject to average if the market is inflationary and prices have risen over the period of the contract.

Average is applied to a claim and is a means by which the insurance company will reduce its liabilities. Average assume that the businessman will cover the loss for the difference between the declared sum insured and the true value and will reduce the claim amount proportionally.

Claims will also be repudiated and denied where it is found out that their has been an alteration to the original cover described at the quote stag which later went on to form the policy contract. For example if a motor trader has not declared that he also runs a taxi business with the same vehicles in the evenings for hire and reward.

To avoid disappointment and ensure that your business is properly covered be prepared with the correct and most up to date information about your business, when applying online for business insurance quotes.

When applying for business insurance quotes online it makes sense to use a company that can either offer fixed levels of cover so that you know that your business falls within these, or provide additional help and advice from an expert or broker on the phone.

At UK Commercial Ltd. you can compare business insurance quotes online from multiple suppliers who offer various levels of cover so that you can avoid losing out to average, at a claim.

Business Insurance Guide

New to Insurance? Just Started a business?

Whether you are self employed, a sole trader, run a small business or enterprise or are a director of a large company, you will need to understand the scope and limitations of Business Insurance policies.

Our Guide to Business Insurance explains all from the top down!

If you have just started a new enterprise or have been asked to look after the company’s insurance renewals, business insurance can at first seem a daunting proposition. After all, much of the language and industry jargon such as endorsements, indemnity levels and excess periods can at first appear alien.

Then there is the question of knowing what covers to get.

With the responsibility of ensuring that the business activities and property are completely covered from risks that the firm might face, a new small businessman may well also be confused by the plethora of covers, plans and policies that are available today.

Business insurance is however fairly simple even for newbies, if you break it down from the top.

There are basically two types of risk that a business may face in daily operations, these being business property risks and business liability risks.

All business insurance policies contain elements of the two risks either separate or combined under a single plan. If you need cover for business buildings and premises contents, you will need property insurance. If you need cover for the work you do, you will require liability insurance. Most businesses need elements of both.

Business property buildings insurance protects all risks to a business premises covering loss,material damage and consequential loss to all buildings, outbuildings, fixtures and fittings on the premises.

The premiums are calculated on rebuilding costs of the business property and will also contain elements of public liability to protect a business against claims from the public of for example, a wall falling on a passer-by.

Property contents insurance covers loss or damage to the contents of the business premises. Business contents policies typically have provision to cover items such as furniture, tables and desks, computer equipment, telecommunications equipment, business electronic equipment, data, tools, machinery, stock, high risk stock, raw materials, fabricated, assembled, manufactured or stored goods and anything used in the daily operation on the business premises.

Freight, cargo and goods in transit cover options provide insurance for the businesses property away from the premises.

Business property insurance polices are typically marketed by the type business property they provide insurance for. For example office insurance, shop insurance, hotel insurance and pub insurance are popular commercial property insurance schemes which contain all the relevant covers for each use of the property type.

Much business property is either rented or leased, in particular offices and shop space. Business insurance provides specialist cover for property owners of these types of premises with a let property insurance policy, which is tailor-made for business landlords.

Business Liability Insurance protects a business against all liabilities that the enterprise might be liable for as it carries out its daily actions. Liabilities are events which occur that could lead to claims against the proprietor, trader, owner, partnership or company. Liability insurance cover protects the company profits against all damages and costs incurred resulting from the claim.

Business Liability Insurance includes Public Liability Insurance, Employers Liability, Products Liability, Directors and Company Officers Liability and Professional Indemnity Insurance.

Public Liability protects the business profits against claims from members of the public and this cover forms the basis of a standard business insurance contract.

If you employ staff you will require by law Employers liability insurance which protects your business against claims resulting from accidents and injuries to paid employees and sub contractors whilst anywhere at work.

If you sell or provide goods or parts your business will need Products liability insurance.This cover is usually automatically included in for example, a shop insurance policy.

Nearly all business insurance polices sold, in particular those online, are what is known as combined business insurance or trade packages that have been specifically designed for particular trades or professions. Find one that allows you to compare business insurance quotes and that is suitable for your particular company by carrying out a search for your trade, service or profession insurance. These combined business insurance policies contain all the covers you will need in your line of work, ensuring that if a claim against your company is made, you will be covered.

The company owners or directors can also purchase Directors & Officers Insurance or D & O insurance as it is often called, which covers them personally against both civil and criminal liabilities resulting from business activities.

Additionally professional services should purchase Professional Indemnity insurance which covers the service against the liability of any advice that might be given professionally and later turns out to be negligent.

Business Insurance quotes from top brands and providers, offering the cheapest prices and excellent cover, only take a minute to compare at leading business and commercial insurance comparison site UK Commercial Insurance.

Originally published By Insurance Blog at

Shop Insurance: Cover for a Nation of Shopkeepers

In the middle of the eighteenth century, the great father of modern Economics, Scot Adam Smith declared that the future of the UK economy lay with free trade and the ability to sell and provide goods and services.

Half a century later a certain vertically challenged Corsican upstart disparagingly called us a nation of Shopkeepers. Two hundred years later to the day, shopping is essential to oil the wheels of the UK economy in our consumer society and shops are ubiquitous business enterprises.

Shops present distinct risks to an Insurer and over the years policies have developed that reflect the liability and property needs of a twenty first century retail outlet. We asked insuranceblogger to investigate what constitutes a shop insurance packaged policy.

A Guide To Shop Insurance Covers

By Insurance Blogger

Owning and running a shop can be hard enough work in itself, often seven days a week, without the additional worry of what might happen to your livelihood should the worst happen. Fortunately there are many different shop insurance policies available today covering all the risks that a retailer might face in running a business from a premises that sells goods and services to the public.

A shop insurance policy will contain a variety of covers, packaged up for the convenience of the shopkeeper.

These include shop buildings and contents cover, stock in trade cover, business interruption and loss of profits, money cover and staff fidelity insurance, legal protection, window & glass cover for shop fronts, goods in transit, public liability, employers liability, and various options to cover shop specific risks. Shop insurance packages will include as standard most of the above risks, whilst some insurers allow the prospective policyholder to select the covers that are appropriate for their particular type of shop.

Shop Insurers use various basic rating factors to decide premiums and postcode and annual turnover are major factors.

The location of your shop will largely determine the price you pay for cover, in particular for shop stock and contents. A shop located in a run down housing estate with known propensity for theft and vandalism will command a much higher premium than one located in a modern shopping centre with street security and CCTV. Annual turnover is used to calculate cover levels such as the impact of a loss on a shops ability to trade.

Shop buildings insurance covers the costs of rebuilding the shop and the costs of replacing the shop front, which is invariably made of glass. All buildings insurance covers permanent fixtures and fittings such as toilets and doors. This cover is available for both shop owners and those who lease the property.

Shop contents insurance covers all the additional shop fittings and equipment that is used in the daily running of the business. Most insurance companies will require a breakdown of the contents of the shop into sums insured fo business equipment, fixtures and fittings, electrical and computer equipment, tenants improvements, refrigerated stock and all other stock.

Shops that require protection for high risk goods held on the premises will usually need to declare the total values of each stock item. High risk shop stock and goods are those that attract thieves and are expensive to replace. Examples of high risk stock items are electronic equipment, cigarettes, and tobacco, designer clothing, computers and digital equipment, software, computer games and consoles, drugs pharmacy and medicines, watches and jewellery, mobile phones and radios, photographic equipment, power tools, TVs, DVDs, CDs and Wines and Spirits.

If your shop has high risk stock you can reduce the cost of your premiums by having adequate security in place. This includes an insurance company approved burglar and fire alarm, window grills, shutters and bars, CCTV and sprinklers. Many shop insurers will only offer stock cover if the minimum levels of security are in place for all shops, regardless of the stock contents held. A lot of insurers may offer further large discounts to the premium if the shop owner lives on or above the premises and is there at night.

Shops by their very nature deal with members of the public and a good insurance policy will usually contain liability cover as standard. This should include Public Liability of up to £2,000,000 for any one claim by a member of the public who may suffer loss or injury visiting the shop.

If you employ staff all policies will offer Employers Liability cover of up to £10,000,000 one event and because shops sell goods and services, Products Liability cover of £2,000,000 for any one period of insurance.

Other standard features of a shop insurance policy are various levels of cover for Legal expenses and Legal protection, Employers, Public and Products Liability, Loss of profits, Glass and Sanitary Ware, Money cover and staff Personal Accident assault, Business Interruption, Goods in Transit, Loss of Licence, Treatment Risks and Seasonal increases in stock contents value.

Shop Insurance is available to buy online from a variety of mainstream and independent suppliers, many of who offer policies for specialist niche shops and retail outlets. Shopping around for cover is easy and many brokers now offer shop insurance comparsion systems where you can compare shop insurance quotes and covers online.

Ensure you read the keyfacts documents of any policies offered, so you are aware of the levels of cover offered before you buy.

Commercial Insurance Covers And UK Flood Risks

Recent extreme weather events in the UK have affected thousands of businesses, many of whom are now struggling to find commercial insurance which will cover flood damage. Instead of declaring flooding as a fundamental risk covered by Government, the powers that be have adopted a King Canute approach and last week announced a further two billion pounds worth of flood and sea defence work.
flood in 2009
Whilst Insurance blog applauds the capital expenditure on public works which are much needed in the current economic environment, this does little to address the potential losses or help those small businesses who currently cannot get cover for water damage caused by flooding.

Types of Flood
Most regions of the UK are at risk of flood to some degree due to the propensity to site populations on river flood plains and coastal areas.
Floods in the UK are either inland, which are all in some way the result of precipitation, or coastal, which can be due to either precipitation or inundation.
There are likewise varying degrees of damage caused by floods from the small localised event to the large and catastrophic.

Inland Floods
Most floods on inland areas in the UK are caused by rivers and run-off overflowing and bursting the available channels, following a long period of heavy rainfall on higher ground. A typical example of this type of flooding causing business damage is where commercial property has been built on industrial estates on river floodplains such as occurred at nationwide in the November floods of 2009 and on the River Don in Sheffield in 2007.
Sheffield incidently is also the scene of the UK’s worst man made flood disaster when the newly built Dale Dyke Dam broke as it was being filled for the first time in March 1864. An estimated 3 million cubic metres of water (700 million gallons) swept down the Loxley Valley joining the River Don in Sheffield centre and on to Rotherham, destroying 800 houses and businesses and killing 270 people.

Another type of inland flood risk is liquifaction, which is where ground water rises following a period of rainfall, saturating and penetrating buildings and ground above areas where runoff is limited. A typical example of this occurs in villages and towns lying on the chalk aquifer of the North and South Downs where spring water regularly floods basements.

Coastal Flooding
Coastal inundations are now more limited to extreme events due to four hundred years of construction of sea defences, although coastal erosion and rising sea levels are now threatening some livelihoods.

Thames flood map
The most typical coastal flooding occurs when a heavy rain bearing low pressure cyclone coincides with high spring or neap tides as occurred in the North Sea in 1953. A total of 307 people were drowned along the East coast from Lincolnshire, Norfolk and Suffolk to Essex. The greatest loss of life and damage to property was in the Thames Estaury where the extreme weather system caused a storm surge and sent a wall of water up the river drowning nearly 40 people in Canvey Island alone and leaving some 24,000 homeless and many businesses destroyed. This event led to the construction of the Thames Flood Barrier to protect London and the building of sea wall defences all around low lying ground.

Britain is not immune to Tsunamis either!
tsunami warning
In January 1607 a ten metre wave believed to have been formed by movements in Atlantic plates swept up the Western approaches and funnelled into the Bristol Channel. The resulting inundation led to the drowning of an estimated 2,000+ people, with 200 square miles (518 km2) of farmland inundated on the Somerset levels, leaving Glastonbury some twenty miles inland, as an island!

bristol channel tsunami

The likely extent of the 1607 Bristol Channel tsunami inundation provided by the Environmental Flood Agency

Drownings were recorded as far North as Worcester. Little wonder those protesting the current development of a new nuclear power station at Hinkley Point hold such fears after the recent Fukushima events.

Commercial Insurance Covers For Flood Risks

Whether your business will be able to purchase insurance to cover risks from flooding depends primarily upon the location of the business and the risk factor associated with the location as provided by the Environmental Agengy Flood Risk Map. This Government data is used by insurance companies, along with known claims data to assess the risk of flood at any particular location and to either price the risk accordingly or reject it. If you are thinking of leasing or renting commercial property is advisable to check the flood map and previous occupiers insurance, before entering into any long term agreements.

A typical commercial property insurance policy will cover or exclude structural damage to buildings fixtures and fittings and machinery caused by flood. Many policies have separate property contents cover for loss of records, office equipment and stock which may or may not be covered depending upon your situation and policy. If you operate in a flood risk area there may be certain policy limits applied which will not cover your potential losses, leaving you effectively under-insured.

Perhaps the greatest risk to a business enterprise from flooding come is the form of business interruption. A business that has suffered serious flooding can sometimes take up to six months of de-humidification and a further six months of structural repairs, before it can trade again. Other unforeseen factors such as the loss of bridges and infrastructure in a flood affected region can seriously affect turnover, even if a business has not been directly flooded.

If your business has been or has the potential to be affected by floods you will find it difficult to obtain cover on the open market. There are however many small business insurance brokers that specialise in declined commercial risks and can offer competitive premiums through managing general agents at Lloyds. It will be interesting to see how many of these survive if the UK suffers regular extreme weather as has been experienced for the last five years.