Understanding How Insurance Premiums Work | Bell Partners

Are you insured? Have your premiums increased? Read more…

The Australian insurance market for the last few years has been very competitive and in what the Industry refers to as a “soft” market – where pricing has been low and Insurers capacity to take on new risks and opportunities has been high.

Recently the market has generally turned upwards, approaching a “harder” market and leading to price increases amongst other attributes.

In the past few years we have also seen significant competition enter the Australian market. There are now well over a 100 different Underwriting Agencies!

Until recently, this – combined with a stable claims environment – has benefited most Clients with lower premiums and ease of transacting with Insurers.

Over the past few years, an accumulation of major natural events such as floods, bushfires and cyclones (Cyclone Debbie in March 2017) has resulted in a drain in capital, and has led to significant losses for insurers – at some point these costs need to be recognised, and to ensure our major Insurers remain competitive we have seen gradual price increases over the past 12 months for domestic lines (home & car insurance) along with business and liability insurances.

Given the market has hardened, Insurers are being more stringent with their underwriting and prices are definitely on the rise. With that in mind, now is a great opportunity to have your insurances reviewed by a Broker/Advisor to minimise any price increases that may ultimately affect your bottom line and where applicable, offer you enhanced protection.

From an emerging risk or what’s top-of-mind for businesses, the recent Allianz Risk Barometer poll (conducted by Allianz Global Corporate & Specialty – AGCS) has business interruption as the most feared threat to companies worldwide in 2018 – this is the sixth year in a row that this concern has hit the top of this annual poll.

The next topic on the list is something I have been discussing with customers the last few years to add to their risk management program, Cyber Security Insurance.

40% of respondents identified cyber attacks as the second threat to their businesses – examples of the recent global attack by ransomware titled WannaCry, infecting around 300,000 computers worldwide!

Technology will always be a top-of-mind emerging risk as the connectivity of devices becomes more prevalent along with the continued advancements in technology. Depending on the nature of your business, I would strongly consider reviewing options for this coverage in the future.

Lastly, as to using a Broker (as licensed professionals) my advice has always been simply, try one – we are experts in the market and often can find you better coverage at a great price, providing guidance on products and coverage that best suit your requirements.

When it comes to your time of need (a Claim), we are also there each step of the way to help you.

Sound advice, great price efficiencies, and having your best interest in mind could be a great option for you – that way, you can keep on doing what you do best – running your business!

Matthew Bates
Managing Director
Bell Partners Asset Protection

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