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Friday, November 30, 2012

The Different Types of Business Insurance

In the UK there are many different types of Business Insurance. It's because of this diversity that the options available can sometimes be confusing. So for a new business that has no staff or an existing enterprise with teams of employees it's important to decide what level of insurance you must have and those that are advisable.

Here is a list of 16 different types of Business Insurance you might consider.

Employers' Liability Insurance - The Employers' Liability (Compulsory Insurance) Act 1969 requires that employees be covered against injuries whilst doing their job - Mandatory.

Motor vehicle insurance - Most business policies are comprehensive or third party, fire and theft. Legally you must, at least, insure your legal liability for injury to others and damage to their property - Mandatory. If you use private vehicles for business use, make sure the relevant policy accounts for this.

Professional indemnity insurance - Protects businesses against injury, loss, or damage, arising from their professional negligence or that of their employees. Depending on your industry certain profession MUST have insurance, these include; architects, accountants, solicitors, surveyors, insurance brokers and financial advisers.

All of the following types of Business Insurance are recommended.

Business travel insurance - Some employees travel extensively around the world. Cover against delays, loss of life and injury; equipment and money is recommended.

Fidelity guarantees - If you are worried about dishonest employees Fidelity Insurance covers against loss of cash or stock.

Key Man insurance - Some businesses would cease to function properly without certain individuals. It's not uncommon to insure Directors and senior managers against the loss of income from death.

Premises insurance - Much like home insurance your business premises should be insured for the complete rebuilding cost.

There are two types standard and "all risks". Talk to your broker about what level of cover you might need.

Contents cover - If you business holds any type of stock you might consider business contents insurance.

Plant and business equipment - Much like contents insurance, you can insure your machinery or business equipment.

Goods in transit cover - This is a popular insurance if you are looking to dispatch high net worth items. The post office always asks the value of your item being sent. Goods in transit cover operates in the same way.

Engineering insurance - Engineering insurance covers against electrical or mechanical breakdown.

Business interruption insurance - The riots in London in 2011 resulted in claims for disruptions to your business. Claims for loss of income and expenses would be likely.

Public liability insurance - This is a very common policy that covers your business from damages to members of the public, either for death, injury or property damage.

Product liability insurance - If you sell a product you need to consider carefully whether that product may harm an individual due to defects or negligence in manufacture. If so, you need to talk through the risk with your legal adviser.

Pollution risk insurance - Pollution is taken very seriously by the Environment Agency. If your business is caught polluting the environment you could be liable and fined and forced to pay to clean it up.

Directors and officers insurance - Company directors and officers have specific duties and responsibilities, for which they can be held responsible. Directors and officers insurance provides cover for compensation and legal costs, if they are found to have inadvertently acted outside their terms of reference.

There are differences in the legislation depending on which part of the country you live in. If you live in Scotland or Northern Ireland you should check local laws.

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Auto Insurance Claim Guide - What You'll Need to File Your Claim

If there comes a time when you need to file a claim with your auto insurance company, you have to be sure to give them all of the necessary information so your claim can get paid right away. This article will fill you in on what you need when you go to file a claim.

You must know who was involved in the accident. Once you are in an auto accident, it is your job to speak with all of the parties involved and take note of their names and contact information. Even if no one looks injured, you need to do this anyway, because there may be injuries present that are not visible at the time.

Look around to see if there were any witnesses to the accident. You may feel like the other driver is at fault, while they may believe the same thing of you. Having a witness available can clear up the question of who is responsible. Do not try to persuade witnesses of anything, since that would be akin to filing a false claim.

When an officer arrives at the scene, make sure to get all of his information. This will help the insurance company get a copy of the police report. They will need that in case there are any disputes.

Write down what the make, year and model of each of the vehicles involved. Also write down the color. This is information that the insurance company will want to know. Ask the driver what year the car is in case you are not sure.

Take note of how many passengers were in all of the vehicles involved. You should write down their names and contact information as well. This is important because one or more of them may file a claim later in the event that they were injured.

Get photos of all of the vehicles involved. These days it is very common to own a cell phone with the capability to take photos. Take advantage of that and snap a few photos just in case there are some disputes later about the damages that actually resulted from the accident.

If you have all of the proper paperwork and evidence when it is time to file an auto insurance claim, the likelihood of you being successful is greater. Have all of the information above ready before you even dial their number.

It's Your Store

Introduction

Small store retailing gets in your blood. Prior to being in the insurance business, I was the manager of a small store and after a five year pause in the game publishing business, a partner of a small retail store chain. It is good now to look back from my new perspective as an insurance professional and bring forward insights for small retail store owners.

Love What You Sell

My path into retailing started as a holiday job at the Lubbock mall toy store (South Plains Mall - Toys by Roy). This was in my Junior year at Texas Tech (Go Raiders!) and my parents had gone crazy about my first college job (compliant desk at the Lubbock newspaper from 5am to 9am) because I made the mistake of bragging that I was sleeping though my morning classes but still "Acing" them. I applied as a holiday clerk in the hobby area selling model trains, Estes Rockets, plastic models and other fun stuff. The manager, Phil Hixon noticed my work ethic and understanding of model trains (my older brother was a model railroader) and I was kept on as part-time hobby clerk. While completing my fourth year of my Business degree, I evolved into being the hobby section manager of this large specialty toy store. I loved selling hobbies and wanted our customers to have what they needed for their projects and soon took over ordering for the entire hobby area. I was a Business Major focused on retailing studies after all and this was my first time to put my learning into practice. I also embraced selling children's toys as an additional passion. I was hooked and while I had several large retailer job offers in the Spring of my senior year, my journey was to be toy & hobby retailing because it was what I loved to sell.

Insight - One of the secrets to success in small store retailing is to love what you sell. Your passion will attract loyal customers. Your personal interest in your products will help you see trends and correctly balance your inventory with the right stock selections.

Rite of Passage: First Christmas In the Toy Business

In the toy retailing business, you must show your mettle by working the Christmas gift buying season. Toys, more than most retailing, are very seasonally focused on the Christmas gift buying event. The whole year is focused on being ready and having the right selection to "bring home the bacon" during November and December. Last year's "must have" toy is now only an OK seller and the two years ago hot toy is in the clearance aisle. Your buyer (that's you in the small retailer world), had to guess at the January Toyfair, what will be the hot items for this year's Christmas season. Half your total sales will happen between mid-November and December 24th. The manager and assistant manager are expected to work long hours and stay focused. Being willing and able to work the 80+ hour per week for the entire Christmas sales season is "the Rite of Passage" in toy retailing. My baptism as an Assistant Manager in the toy business was the Star Wars toy crazed Christmas of 1978.

Insight - Hard work and long hours come with the retail store territory. You will earn your markup.

Ertl Riding Tractor

I still dream about assembling the big green Ertl John Deere Riding Tractor (Lubbock was Cotton Farm country and this was the prime "just like daddy" large gift for five to eight year-old boys). None of the consumers ever successfully assembled this expensive toy. There was no point in selling them the kit in the box because it would only become a messy mangled return. It took an hour per unit, even with practice, to get this beast put together. As assistant manager, I became the designated expert assembler. We sold the heck out of them in 1978 and 1979 when I worked at the Lubbock Toys by Roy as assistant manager.

Insight - Retailing is about adjusting to your customer product wants and delivering it. An assembled Ertl Riding Tractor was something our clients could not get anywhere else. We had them in stock and happily put them together. We delivered what they needed - the other local stores didn't care. We won both the large sale on the tractor and often a whole family Christmas gift purchasing event and repeat off-season visits from the thrilled parent that had obtained their son's critical "under the tree" gift without the torture of putting it together Christmas Eve.

Insight - Your product in retail is the whole shopping experience, not just the item sold. Our "product" included broad selection, help finding the right toy, location, free gift wrapping and yes, free assemble of the Ertl Riding Tractor. We were never the low price leader for toys but had a loyal clientele because of the whole product we offered.

Be the Destination

As a small retailer, you need to achieve and maintain "Destination" status. I ended my career in retailing rather than yield to my ex-partner of our three game store chain in Dallas, Texas over maintaining "Destination" status with adequate inventory selection. Let's face it; Wal-Mart will beat you on price and advertising spending on any market segment they want. Your store must develop a small niche that the big retailers don't want and then dominate it. This is the classic "Big Fish in the Small Pond" approach. If you become just another "Small Fish in the Ocean" your store's going out of business sale will be in the near future. In game retailing, the focus is a selection including the new game releases and having a wide range of accessories in stock. My ex-partner, after I sold out, paid off the IRS and other creditors by not refilling inventory for four months. He then refilled but had lost "Destination" status and our regular customers had left for other better stocked stores where they could buy what they wanted. The chain was liquidated a couple months later.

Insight - Decide on your small niche and do what it takes to be important for your regular clients. Be the destination for your chosen niche. You have to provide a reason for your customers to come, buy and bring their friends. Lease Smart

Most small retail stores are in leased space and getting the right location with an acceptable lease is a critical business decision. My second retail venture was a Game Store chain. Envision a store that featured chess, dominoes, board games and adventure games (Dungeons & Dragons, etc.) and not a video game store. We had a successful location in Amarillo but wanted to move into a large market and were enamored with malls. Dallas was the "Land of Oz" to the eyes of a small city retailer. The only Dallas mall that would offer a lease was Red Bird Mall in far South Dallas. As I assessed the mall opportunity, I made the key mistake of seeing the location from the perspective of Amarillo and not the needed perspective of the big city. This was a mall in decline in the wrong part of town and we had just signed a five year lease in hell. The financial wounds of this bad choice eventually lead to our enterprises' demise.

As a commercial insurance salesman, I often see new store owners sign the lease without any understanding the insurance requirements that they have agree to. The insurance required by the lease can be extensive, sometime ridiculous and well beyond any affordability. Lucky me, I get to be the messenger. While this is a different error, it can have similar results.

Insight - Your location and lease are critical to your financial success in retailing. Be sure you have understanding of your market and have a professional review your lease terms before you sign-up. By all means, have an insurance agent quote the insurance required by the landlord. A bad or overpriced lease or a lease for the wrong location is a quick way to bankruptcy.

Evolution and Listening to Your Customers

The wolf at the door can be the driver of innovation needed to survive in retailing. Faced with an expensive mall store with flagging sales, I had all three staff members writing down anything that our customers asked for that we didn't have. This act of listening was why we survived the unfavorable mall lease and led us to a new niche that made real money. We found many good individual product line extensions based on requests of 2 or 3 customers, but we added an entire new product segment with 153 votes for Nintendo. My partner and I were initially completely deaf to this big wave that was engulfing the game, movie rental and toy business. Nintendo was extraordinarily "hot" and people expected a "Game Store" to have it. Without capital for a big expansion into this very expensive area, we developed a low capital approach of a small selection of new games, taking trade-ins and then renting them by the week or selling them used for a good markup. It was a cash engine and actually pushed us into "percentage rent" (our nasty mall lease had a provision to charge a percentage based on sales).

Retailing is never a steady state. We cornered the "Best Value in Nintendo" market for several years but the market never stays still. The big money (Blockbusters, Funcoland - now Game Stop, et.al.) invaded our niche of used games sales and extended video game rentals. One of my conflicts with my ex-partner was that we had to push our envelope again and find new niches. He resisted any increase in our product selections and insisted that we stay focused on cost cutting and not growth.

Insight - Retailing requires listening to your customers and paying attention to what they want. The evolution of new product niches is part of the business of retailing. Failing to grow your concept or change your product selections to stay focused on your customers will doom any store.

Summary

I hope my vignettes of my personal retailing experiences have been helpful. Retailing was a passion of mine for many years and helped mold the insurance salesman that I now have become. I don't miss the long hours, weekend shifts or the bounced paychecks but I still have fond memories of my years in retailing.

What You Need To Know About Product Liability Insurance

These modern times, people are now very litigious of anything minor or major. That is why there is great rise of the several types of liability insurances in the market to help business owners. One of these insurances vital for a business proprietor is the product liability insurance.

Product liability insurance protects the business and its owner from claims related to the sale and or manufacture of any type of products such as food, medicines, and other goods. This type of liability insurance, however, may not cover the financial losses of the owner or its business due to faulty products that they manufactured, produced and/or supplied to the public.

If a business or company supplied a faulty product, the claimants may try to claim from them first, even if they did not manufacture the product. The enterprise involved will be liable for the compensation claims if any of the following occurred: the business' name is labeled on the product, the business repaired, restored, or changed the product, the business imported it outside the country, the manufacturer cannot be clearly identified, and the manufacturer closed the business.

If not the business itself is liable, then most probably the manufacturers are. Even so, the business should show and prove any or all of the following: the products were faulty or damaged when supplied to them; consumers are given sufficient safety instructions and warnings regarding its misuse; consumers are given conditions for return of faulty or damaged goods to the manufacturer; the business has a supply contract with the manufacturer that covers safety, quality control, and returns of the products; and the business have good quality control systems and record-keeping systems.

There are also cases wherein there is a so-called firing line for claims on product liability. The first in line is the producer or manufacturer of the product. Next in line is the person or business that placed their name or mark, declaring to be the product's producer. Third in line is the person or business who imported the product. It is followed by the person or the business who recondition the product. The last in line is the person or business who supplied the product.

Just like any other professional liability insurance, product liability insurance is not obligatory in law. Yet, every manufacturer, supplier, and retailers should and must protect themselves from the perils of liability claims screwed to them if ever defective products injured any consumer. After all, it is their responsibility to provide the public with quality and safe products.

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Shop Insurance And Security Considerations

Shops have always been the targets for thieves and since the emergence in the early nineteenth century of shopping rows, have presented their owners with various security considerations to deter organised crime. Most of these security requirements were insisted upon by insurance companies before they would underwrite the risk.

Today it is no different a risk for insurers, with the exception that the types of goods to protect and security considerations that retail outlets have to manage have changed somewhat over the years. Likewise today, all insurance companies when offering shop insurance to retailers will insist on what is known as a 'minimum level of security', in order for the policy to be valid.

The responsibility of making a shop building secure to the minimum level of security will usually lie with the owner of a property. If the shop is owner-occupied then the retailer will require an all risks buildings and contents shop insurance policy.

The buildings section of the policy will insist with clauses and wordings that certain thief deterrent security features are in place. Typically these include double mortice locks on doors and windows and grilles or bars where appropriate.

Most shop premises are either leased or rented and in these cases it is advisable to refer to the leasehold contract or landlord's tenancy agreement, as to establishing the responsibility for insuring the buildings and securing the premises.

Tenants will be more concerned with protecting the shop fittings, stock and shop contents, however tenants also have a large role to play in ensuring that the shop premises are secure and will be responsible for providing additional security. Shop contents policies usually also cover any improvements a retailer has made to the interior of a building and include a fixed level of indemnity for this.

Many shop insurance packages exist on the market which offer a choice of buildings and or contents covers to choose from as part of a wider all risks package suitable for both landlords or tenants.

The shop package includes covers for risks such as business interruption, public and employers liability cover for shop staff and a range of legal and staff protection insurance covers which may occur as a result of an attack on the premises or a break-in.

All shop insurance policies will ask at quotation stage the levels of security that currently exist for the shop, however this is highly dependent upon the type of trade being carried on at the shops premises. Insurance companies will need to know the type of locks and bolts used, installed alarms, CCTV and whether security patrols are employed.

Many shop insurance companies will insist that certain approved burglar alarms are installed before offering to underwrite the risk. If the shop sells high risk goods such as high value electronics or alcohol and tobacco, then most insurance companies will insist on additional security and ask that levels of sums insured are defined for each type of high risk stock.

The premium paid for a shop insurance policy will often depend upon the security devices in place. These devices, although often initially an expensive outlay, can prove to save money over the long-term as generous discounts are available where the shop's security meets all the insurers recommendations. This is especially true if the shop is in a high risk theft area where without doubt the insurance company will set higher minimum security requirements.

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Commercial Minibus Insurance

It is usual for insurers to design policies for specific applications and this is applicable for commercial minibus insurance. This is because the needs and requirements differing significantly between one operator and another and especially in comparison to other vehicle types, for example, cars and motorcycles. Should a particular minibus not be used solely for commercial purposes, there are options for multi-purpose policies. However, if the vehicle is commercially related, then it will conform to the basic policy conditions, as would a taxi.

Under the terms of a commercial policy, a premium consideration is made for the fact that as a result of additional seating, there is added liability. This has the consequence of potential claims for whiplash or injury to those conveyed by the vehicle during an accident. It is a situation that could involve the insurers in substantial financial settlements of claims for compensation. Accordingly, this potential risk is incorporated into the monthly or annual premiums for in insurance.

A general classification related to any vehicle with a seating capacity for more than nine persons, but less than sixteen, is that of a minibus. Should the vehicle be used in connection with a business than the owner must apply for commercial minibus insurance! This is different in comparison to usual terms of insurance, as the owner or driver, will be responsible for various passengers, who are paying money for conveyance between two places. Adequate insurance coverage is critical, no matter whether a minibus is used as a taxi or for private tours.

The higher risk factor for a minibus does not only relate to the high distances travelled, which usually indicates a greater potential for accident involvement. Other factors that are also taken into account by insurers are the likelihood of vandalism and the potential fire, theft and third party claims for compensation that could arise. This increases the level of risk to the insurance company, when compared to average type of vehicles and explains the higher premiums required.

The assessment of the terms and conditions related to insuring minibuses cannot be regarded as being as relatively uncomplicated as that of general and car insurance. Highly varying factors need to be considered, including specifically the vastly differing mileage covered by the respective type of vehicles and the contrasting numbers of people conveyed. These operating conditions must naturally be related to the added risks involved.

In this age of high volumes of passengers travelling to many and varied parts of the United Kingdom and even into Europe, differences in the design of insurance policies are considered. Careful consideration is given to the various related aspects of the vehicle usage. The insurance company and the policy holder are provided with terms and conditions in the insurance policy that meet the needs of a particular application at a reasonable cost.