Ensure you're insured

Following on from the recent riots, both bira and insurance partner, Towergate Risk Solutions Northampton, have become aware of businesses with insufficient insurance cover.

Two main areas for you to consider are the adequacy of cover and the sums insured.

For contents, fixtures and fittings and stock, you must ensure that you declare the maximum value which will be at risk during the policy period.
For Business Interruption (BI), the sum insured must represent the loss of profits you expect to suffer over the period it takes to get your turnover back to the level prior to the insured incident.

BI covers loss of profit for a period after a loss - the indemnity period should be long enough to allow a business to make a full recovery from an insured loss. After a serious flood or fire it can be many months until a business can start to trade again and after that it can take a considerable time to restore the business to its full pre-loss turnover and profitability. Never underestimate how long this can take. Properties destroyed by fire in the recent riots will take many months to rebuild.

Most retailers’ insurance policies include a BI insurance section as standard with a 12 months indemnity period. Is this period long enough for your business to fully recover? The Towergate Retailers policy provides an automatic cover of up to £750,000 with an indemnity period of 24 months. This should be sufficient for most businesses to give you peace of mind without having to calculate your annual gross profit. If yours is a larger business the BI insurance section will be an optional cover and you will have the chance to select your own indemnity period and annual gross profit. When considering the length of the indemnity period do think about:

1. The time to demolish and clear the site after a fire or dry out after a flood;

2. The time to organise rebuilding including the time to obtain local authority approval:

3. The time to obtain replacements for any specialist equipment; 

4. The time to recruit replacement staff

You should also ensure that your policy provides cover for denial of access because where damage is widespread, it maybe that the authorities will not allow access to your premises for some time, even if you have not suffered damage yourself. Many of you have spent a number of years building your businesses. Do not put it at risk by having inadequate insurance.

Should you wish to review the adequacy of your cover and obtain a quotation from the bira approved insurance provider, please call Towergate Risk Solutions Northampton on 0844 892 1330.

The British Independent Retailers Association (bira) is an Introducer Appointed Representative of Towergate Underwriting Group Limited. Towergate Risk Solutions Northampton and Towergate Insurance are trading names of Towergate Underwriting Group Limited. Registered Office: Towergate House, Eclipse Park, Sittingbourne Road, Maidstone, Kent ME14 3EN. Registered in England No. 4043759. Authorised and Regulated by the Financial Services Authority.

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