Its renewal time again and your annual policy paperwork has arrived just in time. What to do!? Just pay the premiums and think nothing of it for another 365 days? Think again!
It can be very tempting to “go with the flow” when it comes to your insurance – at the end of the day you’ve paid your premium and ‘you’re covered’! But what happens if your situation has changed since your last renewal? Maybe you’ve renovated your house, you have an additional undisclosed driver of your motor vehicle, or have been gifted valuable jewellery that isn't listed on your contents schedule...this is where Insurance policy maintenance is important.
Helpful steps to follow at renewal
It's essential to keep your broker and insurer updated with any changes relevant to your insurance, regardless of the policy type. If you haven’t discussed and made relevant changes with your broker, you may experience coverage issues in a claim.
1. Compare multiple quotes
As Insurance Brokers, it's our job to find and recommend the most appropriate, cost effective insurance policies to suit your needs. At renewal you are under no obligation to stay with the same insurer, and we will always source the best quotes and coverage from a wide variety of insurers while taking into account your situation and needs. Keeping us abreast of changes to your circumstances allows us to recommend the most suitable insurance products for you, and MOST importantly can help ensure you are covered in a claim.
Tip: it’s tempting to choose the cheapest policy, but that doesn’t always guarantee comprehensive cover in a claim. The quality of coverage, as well as its relevance to your specific needs are the most important factors when selecting an insurance provider.
2. Review your Product Disclosure Statement (PDS) – Does it still work for you?
If there have been changes to your ‘insurable interests’ e.g. your vehicle, home, rental property, business activities, business income etc. it's important to ascertain whether your existing insurance policy(ies) will still provide appropriate cover in a claim.
Reviewing your current PDS documents will help you stay informed on what is insured, and where you need to extend cover to account for changes in your 'insurable interests'. It may be that your existing policy is no longer capable of providing sufficient protection, and is misaligned with your changed risk exposures. In this instance, the best course of action could require switching to a different insurance policy that delivers more suitable coverage in a claim.
Insurance Brokers are experts in this area, providing advice, recommendations, and navigating complex policy wordings on your behalf, to ensure your insurance cover responds to safeguard your insurable assets and liabilities as required.
3. Review your excesses and payment options
A majority of insurance policies are placed with the insurer’s standard excess applied. Did you know that by selecting a higher excess, you can often lower your overall premium? Consult with your broker to see how your premium can be affected by adjusting your excess.
It’s also wise to review your payment options. Whitbread provide Pay-by-the-month options for a range of policies, and can tailor a funding program to suit your financial position. Pay-by-the-month is a great way of maintaining cash flow, avoiding large lump sum payments while still protecting your assets.
4. Review the Sums Insured and other key details on your insurance policy schedule
When reviewing your policy schedule, consider some of the following, and update accordingly:
- Are your listed business activities still accurate?
- Is your turnover still correct?
- Are the interested parties listed on your policy correct?
- Is your Business Interruption Indemnity period long enough?
- Have you recently renovated or made improvements to your property and not increased the Building Sum Insured?
- When was the last time you had a valuation performed – is the Building Sum Insured still accurate in current market conditions?
- Are some aspects of your coverage no longer relevant? E.g. Flood, Machinery Breakdown, Swimming Pools.
- If you have recently sold or purchased valuable items, has your Contents and Specified Valuables schedule been updated accordingly?
- Have there been improvements to the security at the property? I.e. window locks, lighting, alarms - an increase in security can sometimes decrease your premium.
- Has a known Asbestos Risk been removed from your property?
- Have your commercial occupants changed in the last year? If your tenants' business activities have changed, but you haven't notified the insurer, you may not be covered in a claim. Their business activity can also impact your premium (Applicable to Commercial Strata properties)
- Is the Sum Insured on your vehicle still accurate? Have you added accessories or modifications that haven’t been noted on the Schedule?
- If you have additional drivers, or drivers ‘under 25 years of age’ driving your vehicle, have you notified your insurer?
- Is your vehicle stored in a locked garage overnight instead of being parked on the street?
- Has your address changed?
- Has the use of your vehicle changed from Business to Personal?
Tips to stay on top of policy maintenance
If there are any changes to your insurable risks, don’t wait for renewal time to make the necessary changes. Be proactive and immediately notify your Insurance Broker. There are many circumstances, such as improved business, household or vehicle security measures, which can actually lower your annual premium and also open up the market place to other insurers because your risk may now fit their specific insurance risk appetite guidelines.
Does this article raise any red flags?
Even the most minor change in one of your risks can affect your policy premium and the likelihood of being covered in a claim. A well maintained insurance program will help provide suitable protection, capturing the true value of your insurance when it matters most.
For expert advice, speak to on of our professional insurance advisors. We will work alongside you to ensure your insurance solution accurately reflects your risk profile:
This article is not intended to be personal advice and you should not rely on it as a substitute for any form of personal advice. Please contact Whitbread Associates Pty Ltd ABN 69 005 490 228 License Number: 229092 trading as Whitbread Insurance Brokers for further information or refer to our website.
*Typical building replacement costs are provided by Reed Business Information Pty Ltd (A.B.N. 80 132 719 861) trading as Cordell Information (‘Cordell’) and typical building contents replacement costs are provided by Sum Insured Pty Ltd (A.B.N. 55 947 630 521 (‘SI’) trading as Home Contents. Whilst every care is taken to ensure the accuracy of the information as a guide for costing, no responsibility is accepted by Cordell, SI, Steadfast or the Steadfast Broker for its accuracy. Please check with an Architect, Builder, Quantity Surveyor, Valuer or other suitably qualified professional for an accurate estimate. Neither Steadfast nor the Steadfast Broker takes any responsibility for the costs provided by Cordell or SI, or any liability for the accuracy of or reliance upon or use of, the costs. To the fullest extent permitted by law, Cordell, SI, Steadfast and the Steadfast Broker expressly disclaim all warranties, express or implied, including, but not limited to, the implied warranty of fitness for a particular purpose. Cordell, SI, Steadfast and the Steadfast Broker do not warrant or make any representations regarding the use or the results of the use of the information provided in terms of its correctness, accuracy, reliability, or otherwise.