Category Archives: Insurance

Is it time for your Insurance Renewals?

This is the time of year when many people have to prepare to renew their insurances.  Don’t forget, if this includes you!  It is good to review as well as renew.  I have written before about how to keep your premiums down.  http://ezinearticles.com/?Ten-Top-Tips-to-Reduce,-or-at-Least-Control,-Your-Insurance-Premiums&id=7309130

I have also written on the risk of ignoring certain risks.  http://ezinearticles.com/?Do-You-Need-to-Insure-Or-At-Least-Manage-Any-Or-All-Of-These-Four-Often-Neglected-Risks?&id=7744310

I have noticed that many people concentrate on insuring things they can see such as buildings, vehicles or computers, and forget about what they may think are unreal or “airy-fairy” risks.  This could be a mistake!

  • If you insure your premises against fire and other physical risks, what about “business interruption” risks, resulting from the premises becoming unusable following a fire or whatever?
  • If you insure your computers against theft, what about the data on them, or the effect on your business if they were out of use?
  • If you insure your vehicles, what about the risks to you as an employer when your employees use their cars in the course of their work?

Have a thorough review.  Feel free to have a word with me if it will help.  A little chat won’t cost anything.

01925 445215

john@jhmriskmanagementservices.co.uk

How to beat “Crash for cash” scams.

I know I have included this advice in the Tip of the Month some time ago, but recent events have reminded me that the risk has not gone away.

The usual trick is to overtake and brake suddenly, causing you to run into the back of their car.  Alternatively, they might reverse into you.  They rely on the insurers and the courts assuming you must have run into the other car because you were going too fast or driving too close.  They then exaggerate their damage and claim for non-existent injuries to themselves, often adding a few passengers who were not there.

They can be aggressive, especially if you want to call the police, or anyone else.  Try to stay calm and do not be intimidated.

Above all, if you are in a road accident, especially if you have any reason to be suspicious, take photos.  That will provide some evidence.

  • Take close-ups of the damage.
  • Take shots of the two cars.  Make sure you get the make and number plate.
  • Take photos of the other driver, in case someone else brings the claim.  The real registered owner, perhaps, or a partner in crime.
  • Take photos of the interior of their car getting any passengers, or showing that there were not any.

If they object to your taking photos, do call the police.

These are organised criminal gangs, and the police want to know about them.

 

Motor Insurance Scam.

Here is another example of a fraud I have come across and some comments on how to reduce the risk of similar things happening in your business.

An insurance broker added elements to genuine claims as he forwarded them to the insurers.  These included injuries, additional passengers, and car hire.  He always had the cheques or other payments made to him, from which he paid the claimants, keeping large profits for himself.  He colluded with:

  • A car-hire firm.
  • A solicitor.
  • A doctor, producing phoney medical reports on demand.

He was aware that different insurers had different practices regarding investigating claims.  He always ensured he kept his claims just below the threshold.  He was caught when a claimant contacted his insurers direct and was amazed to learn of all the payments they had made to him for his minor accident.  He and they went to the police.

Even if you are not in the insurance business, think how this could apply to you.

These are some controls you could apply.

  • Avoid letting one person channel all payments through himself.
  • Do not have a rigid policy for investigating anything.
  • Be suspicious if someone always uses the same subcontractors, e.g. the car-hire firm and the doctor.
  • At least sometimes, insist on bypassing the middle-man and speak to the end client.

What should you do if someone brings a Public Liability Claim against you?

Follow these 12 Steps if Someone Brings a Public Liability or Employer’s Liability Claim Against You.

Big businesses, local authorities and other large organisations receive claims from their employees and the public regularly and have people and systems to deal with them.  You may not be so lucky, and receiving a claim when you are not used to it can be confusing and stressful.  If it is a motor claim you can probably rely on your motor insurers to deal with it, but if it is a liability claim here are some tips on what to do.

If you want to avoid paying a claim you did not need to, or paying more than you should, follow each of these steps and keep a record of everything you do at each stage:

  1. Acknowledge the letter, without commenting on the contents.
  2. Ensure it is a claim, i.e. a demand for money (“compensation” or “damages”) and not just a complaint or request.
  3. Check whether you are covered by any of your insurances.  This may be a specific Employers Liability, Public Liability or Combined Liability policy or it may be included as part of a Household or Business policy, so do check.
  4. Certain kinds of claim may not be covered, or may be on a separate policy, such as:
  • Libel and slander
  • Environmental Pollution
  • Cyber Risk (claims arising from the use of computers)
  1. If you are covered, or if you are not sure, inform your insurers or brokers.
  2. Always comply with any instructions they give, otherwise you may invalidate your policy.
  3. Always give your insurers promptly any information or documents they ask for, OR let them know you do not have them.
  4. Let your insurers know of any suspicions you have that the claim may be fraudulent, but remember suspicions are not the same as proof, frustrating as that may be!
    1. If you are not insured, you may be able to investigate and deal with the claim yourself, or you may wish to seek help from a professional.  They should be able to give you some initial advice to enable you to decide whether to engage their services.
    2. Whether insured or not, you may be able to get some help from any trade or professional association you belong to.
    3. Whether insured or not you may be able to save time, money and stress by employing a claims-handler to advise you and manage the process.

 

Finally, deal with the claim promptly: it will probably not go away, and there are time-limits set by Law.  Then keep the process moving: time really is money as far as the claimant’s solicitors are concerned.  If you have not got the time to deal with it properly, make sure somebody does so for you, whether an employee, friend or someone you are paying to look after your interests.

 

Ten Top Tips to Reduce, or at Least Control, Your Insurance Premiums

Ten Top Tips to Reduce, or at Least Control, Your Insurance Premiums

Don’t accept premiums as if they just fall out of the sky. Here are some ideas to help you take the initiative. For many people insurance premiums are controlled by mysterious market forces beyond their control.  All they think they can do is shop around for the best deal, which is always a good idea, but there are in fact a number of things you can do to influence your premiums regardless of which insurer you choose.

There are two main areas you need to think about: Cover and Claims.

First, take a good look at cover, i.e. what and how much you are insuring, as you do not want to be paying for anything you do not really need.

There are usually four elements to this:

  • Excess – the amount of each claim, which you, not the insurers, will pay.  Increasing this should lead to a reduction in premiums.  How big an excess you should have depends on how much you or your business could afford if there was a claim.
  • Limit – a maximum that insurers will pay, either for each claim or in total for any year: the lower the limit, the lower the premium.  The right limit for you depends on how likely it is that you will have a claim above that level, and how damaging it would be to your business.
  • Exclusions – things the policy does not cover.  There should be a reduction in premium for each exclusion.  There is no point in paying a premium to cover an event that is not possible in your circumstances e.g. demolition work, if you only build or repair property and never demolish any.
  • Extentions –the opposite of exclusions: non-standard items added to your policy, at extra cost.  Do you need them?

If this process results in higher premiums, because you decided to opt for more cover, you should still see it as a saving, if you compare the extra premiums with what an uninsured claim might cost.  Real waste usually occurs when you are paying for more insurance than you need, not when you make an informed decision.

Then have a look at claims, as the more claims you have, and the more they cost, the higher your premiums will be, and insurers are interested in possible future claims as well as actual past claims.  There are two ways of reducing the number and cost of claims: claims management and risk management.

Claims Management is worth thinking about for every kind of insurance but it is really important for liability policies, i.e those which pay for claims brought against you by people who blame you for injuries or damage they have suffered.

  • Make sure you have a system in place that will work for you, whether you do everything yourself, rely on your insurers, or employ some specialist firm of claims handlers, and be sure someone deals with each of the points listed here:
  • Notify your insurers as soon as you know a claim is likely to be made even if you do not have all the facts they will need, but send the rest as soon as you can.
  • Comply with all instructions and requests from your insurers.  If you do not they may be have the right to refuse to cover your claim, and anyway they probably have a good reasons for their procedures.
  • Get all relevant information together as soon as possible – it is surprising how soon details get forgotten or documents lost.
  • If someone brings a claim against you make sure it is properly investigated as quickly as possible so as to decide whether to pay it or not.  Trying to defend what cannot be defended is a waste of time and money, but so is putting off a decision.
  • If you have any suspicion that a claim against you is fraudulent, make sure someone looks into that aspect too.

Risk Management.

Some people would say that this includes everything covered in this article and a lot more, and they may be right, but what I mean here is how to control the causes of the fire, accident or whatever, which led to the claim.

  • Make sure you get feedback from insurers, investigators, or claims handlers as to the reasons they believe it happened and what they think could be done to prevent it happening again.  Try to find out how often such incidents occur, whether they lead to claims or not, in deciding priorities.
  • Once a year, look over all your activities and see where there are possible risks, even if nothing has gone wrong so far.  You may find it worthwhile having someone else look at them with you, as it is very easy to miss the obvious when you see it every day.
  • List options for controlling each risk and pick one or more which you think will work best for you, taking into account such things as the cost of the control measures and the possible cost of a claim and its effects on your business.

It is important that you spend some time thinking about each of the points in this article, and especially that you then act upon them, if you want to take at least some control of your insurance costs and not let them just seem to drop on you out of the sky.