EOFY Is the Perfect Time to Review Your Insurance – Here’s Why
As the financial year draws to a close, many businesses are reviewing their performance, setting budgets, planning investments and looking for opportunities in the year ahead.
It’s a natural time to ask questions like:
- What worked well this year?
- Where are we investing next year?
- What risks could impact those plans?
- Are there areas where we’re spending more than we need to?
What often gets overlooked is whether your insurance program still reflects the business you have today.
For many businesses, insurance is reviewed at renewal and then largely put back in the drawer until the following year.
The challenge is that businesses rarely stand still.
Over the past 12 months you may have:
- Increased revenue
- Taken on new staff
- Expanded into new locations
- Purchased equipment
- Signed larger contracts
- Added new services
- Increased stock holdings
- Become more reliant on technology
Each of those changes can affect your insurance needs.
EOFY Is About More Than Cost Savings
When people think about reviewing insurance, they often focus on premiums.
While cost is important, it’s only one part of the equation.
A good review should answer three questions:
1. Is your current insurance still the right fit for your business?
The reality is businesses evolve.
Services change. Revenue changes. Contracts change. New risks emerge while others become less relevant.
Yet it’s surprisingly common for insurance arrangements to continue largely unchanged year after year.
EOFY is a good opportunity to step back and ask:
- Does our insurance still reflect how our business operates today?
- Are there gaps that have emerged as we’ve grown?
- Are there opportunities to structure things differently?
- Is there value in getting a fresh perspective on our insurance program?
Sometimes a review identifies areas where cover should be strengthened.
Sometimes it identifies opportunities to improve value or streamline the program.
Either way, it’s difficult to know if you’re still in the right place unless you take the time to look.
2. Have we become underinsured?
This is one of the biggest issues we’re seeing.
Construction costs, replacement values and business interruption exposures have changed significantly in recent years.
Many businesses have grown, but their insured values haven’t kept pace.
The result can be a nasty surprise if a claim occurs.
3. Will our insurance support our plans for next year?
Perhaps the most overlooked question.
If your business is planning to:
- Win larger contracts
- Enter new markets
- Employ more people
- Acquire another business
- Invest in technology
- Expand locations
Then your insurance should be part of that planning process.
Insurance shouldn’t be something that catches up with growth after it happens.
It should support growth before it happens.
The Best Time To Fix A Gap Is Before You Need It
Most insurance issues aren’t caused by bad decisions.
They’re caused by businesses changing faster than their insurance arrangements.
EOFY creates a rare opportunity to step back and review the bigger picture.
Not just what your business looked like 12 months ago.
But where it’s heading over the next 12 months.
If you’re already reviewing budgets, forecasts and business plans, now is a sensible time to review your insurance program as well.
A conversation today is often far easier than a claim tomorrow.
Ask for an insurance review from the Bell Partners Insurance team via info@bellpartnersap.com.
123 Insurance Pty Ltd ABN 67 621 727 722 ATF for 123 Insurance Unit Trust ABN 46 332 885 229 trading as Bell Partners Insurance is an authorised representative number 1259573 of Community Broker Network Pty Ltd ABN 60 096 916 184 AFSL 233750. This advice has been prepared without taking into account your personal objectives, financial situation or needs. You should therefore consider the appropriateness of the advice, in light of your objectives, financial situation or needs before following the advice. Please obtain a copy of, and consider the Product Disclosure Statement applicable to the general insurance product before making any decision.
