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What kind of Insurance do I need?
This depends on the type of business. New forms of business are being developed constantly in response to the challenge of industrial and commercial changes. Many modem developments involve potentially high risk and great cost — and these have been reflected in special types of insurance cover. Brokers and insurers are constantly expanding the limits of insurance resources and expertise, which enables new policies to be produced to suit all kinds of situations.
How can my company receive insurance cover at the right price?
Obtaining the correct insurance at a fair price requires extensive knowledge of all your own business and the insurance market. The amount and type of cover your business needs must be assessed with great care. As the economy and your business change constantly, so does the insurance industry New types of cover are continually being devised, some of which might meet your needs more appropriately than your present policies.
A selective buyer of insurance has to understand the types of cover in which various insurers specialize, as well as the rates being charged. Professional insurance brokers have this specialist knowledge and expertise, and are better able to select the insurer and protection you need.
How can I make rational decisions in such technical matters?
In most cases you simply cannot do it on your own. You can do the necessary research, but only if you have the time, the staff and the know-how. Or you can ask an insurance broker. Their livelihoods depend on knowing the insurance market and keeping in touch with the latest developments. They are skilled at assessing the risks to which organizations are exposed and in devising programs to provide the most effective cover. They can use specialists in risk management to minimize risk exposure and reduce the potential impact of loss, thus reducing future premiums.
How do I avoid buying too much insurance — or too little?
Your business needs protection against the possible disastrous effects of events beyond your control (such as fires, storms, or riots), so that business risks are limited to those which can be managed. The potential impact of loss-producing incidents may be reduced considerably by minimizing risks and adopting better procedures. In some cases, the policyholder might bear an initial amount of loss (called an excess or deductible), which reduces the premium cost, but still protects against catastrophic loss. Putting together a balanced portfolio covering all aspects of an operation, is a professional broker’s business. To reach the right decision, you should seek expert advice in identifying the types of risks to which your business is exposed and selecting the most efficient strategy for neutralising their effects.
How can I control my insurance needs and commitments from day to day?
Fluctuations in asset values and stock levels, aggravated by inflation and exchange rate changes, might require adjustments to your levels of cover. Policies need to be reviewed on a regular basis. Claims requiring detailed documentation may have to be made and legal requirements can change suddenly. Undertaking new business contracts might expose the company to liabilities for which no insurance provision currently exists.
A broker’s task is to sort out the tangles to assist you. So always advise your broker of any proposed changes (well in advance). Brokers can monitor your business, ensure that levels of protection are sufficient and devise systems to simplify the control of your insurance program.
Who can give me the best terms?
Different insurers may specialise in particular forms of insurance and their assessments of risks can vary widely The broker’s role is to seek out the cover most appropriate to the need, at a competitive premium. Most Australian insurance is placed in the domestic market, but some very large or unusual risks require the full resources of the world wide insurance community. Your broker can tap into them for you.
How can I be sure that the insurance company is financially sound?
The stability of most insurance companies, particularly those operating in Australia, is generally beyond question — although no-one can provide any guarantees in this regard. However, they might not all offer the most appropriate cover or competitive rates. To find an insurer that is both reliable and competitive, requires an intimate knowledge of the market.
Achieving the proper blend of security, protection and competitive rates on behalf of the insured is the specific task of insurance brokers. Their relationship with their clients depends on making certain that the insurer with whom the business is placed, performs to the highest possible standards.
What is the most effective way to make a claim?
Lodging a claim involves producing the necessary documentation, making contact with the insurers and/or their adjuster, then presenting the case clearly and concisely. Looking after these problems is an integral part of the broker’s service. Your broker will ensure that no time is lost in achieving a prompt and fair settlement.
Can I be sure a broker will use premiums on my behalf?
Companies, partnerships or individuals wishing to transact business as insurance brokers in Australia are obliged by law to be licenced by the Australian Securities and Investments Commission and are subject to stringent legislative requirements concerning the receipt and onpayment of premium moneys. Insurance brokers arrange most of the general insurance cover for commerce and industry in Australia, and it is estimated that ninety per cent of all broker-placed business is handled by members of the National Insurance Brokers Association of Australia (NIBA). By working closely with government on the registration and control of insurance brokers, NIBA is helping to provide greater security for the Australian insurance buyer.
What is the relationship between brokers and insurers?
As an insurace broker, we normally act for you. However, in some circumstances we may enter into an agreement with an insurer to arrange insurance policies on their behalf and not on your behalf. If we are given a binding authority from the insurer, this means that we can enter into insurance policies and/or settle claims on their behalf. We will inform you when we act for the insurer and not for you.
Do many companies use insurance brokers?
As mentioned earlier, much of Australia’s general insurance is placed through insurance brokers — and most of this relates to commercial risks. Nowadays risks are too complex and the available choices too varied for most companies to be able to arrange their own protection. Reputable, professional insurance brokers are the main source of expert advice to companies on the most effective ways to assess and meet their insurance needs.
Why is it important to deal with a member of NIBA?
An insurance broker, especially one who is a member of the National Insurance Brokers Association (NIBA), is a professional, whose primary responsibility is to act for you, the insurance buyer.
All insurance brokers have to be licenced by the Australian Securities and Investments Commission, but membership of NIBA is discretionary. Members are required to go through a secondary screening process, comply with a strict Code of Conduct and undergo continuing professional development to attain and maintain the qualification of Qualified Practicing Insurance Broker (QPIB).
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