Archive for the ‘Client stories’ Category

Think you’re safe from Floods affecting your business because you’re situated on top of Uluru? Wrong! Your business income could still be at risk.

I don’t know how many times clients have laughed when I have asked them if they require Flood cover when they are located on the 10th floor of an office building. I then ask my clients the following;

Would your business suffer if, Flood damage caused;
-    Your suppliers two states away are hit by a flood, what will happen now you can’t get parts or equipment in. How low will your production drop?
-    A client’s premises is damaged by flood and they have now put all orders on hold until they are back up and running. Were you relying on that income to pay your staff wages and bills?
-    The bottom level of your office building was flooded in? Would your client’s be ok with swimming in and climbing the 10 floors to your office?
-    An interruption to your supply of communications, electricity, gas or water? Do you have a supply of torches and type writers you can keep going with?
-    Some of your equipment you rely heavily on is located on a site temporarily and is hit by a flood. Can you replace this equipment quickly before your income is exposed?

The truth is, the financial affect of a flood can hit you in many more ways then direct property damage. So if you thought about any of the above points (even for a moment), I suggest you look into obtaining Flood cover on your Business Pack as this is not a usual inclusion on most Business policies and must be requested separately.

As all Flood insurers have different terms and conditions, the above scenarios may not be covered or there could even be other benefits not highlighted above, that’s where Eagle comes in. We have access to a number of insurers who provide Flood cover for businesses so we can help you get the right cover at the best price.

For an obligation free quote, please call Candice Klau at Eagle Insurance Brokers on 02 6639 6466

BUSINESS – REAL ESTATE

Real Estate Agent

Event – Fire

• Fire, as a result of arson, at insured premises caused extensive damage.
• The premises had recently undergone renovation, which included repainting,  addition of a new telephone system and a new computer system.

Response -  Relocation

• Insured was able to relocate to temporary premises within 5 days.
• The new premises was set up with computer screens and the telephone system had been changed over to the new premises within the week.
• Signage redirected customers to the new premises.
• Operations recommenced 6 days after the interruption.
• Fist claim payment was made 7 days after the incident.
• Insured suffered disruption to turnover as a result of relocation and reimbursed by the insurers policy for a loss of turnover suffered over the entire indemnity period.
• Total Claims Payment was in excess of $100,000.

BUSINESS – WHOLESALER

Wholesale Grocery and Retail Supermarket

Event – Public Utilities

• Friday 2:00pm a tree brought down a power line into the insured’s property. The storm was accompanies by wind gusting up to 120kph and over 300mm (12”) of rain.
• The business was unable to open on Saturday as they had no power and could not operate their point of sale system, there was no lighting, telephones or facsimile access to the property.

Response

• The insurer arranged for hiring of three generators which were commissions at 8:30pm on Sunday.
• $1.5mil of stock in the large freezer was protected.
• Stock loss of $70,000 occurred in the smaller freezers.
• Quick action and the availability of a properly constructed policy meant the loss was limited to one days trading, replacement of the stock would have taken a number of weeks and may have cost up to $300,000.
• No time excess was applicable to the public utilities cover which enabled the insurer to respond to and pay this claim, unlike many other policies.

BUSINESS – MANUFACTURING

Fabricated Structural Steel Manufacturing

Event – Prevention of Access

• On Sunday morning a major fire occurred down the road from the insured’s premises.
• Power and water were cut off from the area and when the insured returned to work on the Monday they found that the street was barricaded off by the Police blocking access to their premises.

Response

• The loss adjuster and insured discussed overtime but this was not practical as workers in the factory were in the process of fulfilling a large contract and were already working overtime.
• The loss adjuster then requested turnover figures, which the insured provided promptly, and the claim was settled 17 days after notification.

BUSINESS – TROPHY MANUFACTURER

Trophy manufacturing, warehousing & distribution for wholesale & retail

Event – Fire

• Fire caused by an electrical fault – 8am 11 February.
• Building severely damaged.
• Insured had just unpacked two containers of stock from overseas.
• All stock lost and therefore disruption to future sales and cash flow.

Response

• Insured travelled, subsidised by the insurer, to China and Taiwan to order replacement stock.
• Replacement stock air freighted to Australia.
• Insured consolidated operations into one premises while awaiting building replacement.
• The Insurer paid “Additional Increased Costs of Working” including:
  - Rewiring telephone and data cables at alternative warehouse
  - Additional rent for alternative offices
  - Legal fees for new lease
  - New security system

• Within 23 weeks the insured reoccupied the original premises with no further interruption to turnover.

Are you insured properly?

Do you have a disaster management plan?

What will happen to your turnover should your business get extensively damaged?

Most businesses insure their physical assets that they own as either the bank has told them to (they may have lent money to start the business), their accountant told them to (they are giving them business advice to set up the business), or it is simply a prudent thing to do as they have sunk cash into your business to get it started.

So ask yourself this:

• what about the very reason why you went into business?

• What about the money you intended to make along the way?

• What about the jobs that you provided for the people that worked for you?

• What about the flow on effect that your business may have to your local community loosing jobs and a local service?

Isn’t it worthwhile to ensure that the continuity of your business is protected?

If you haven’t considered Business Interruption Insurance before or haven’t reviewed it lately you may want to drag out that old insurance policy and dust it off as this is the very life blood of your business. 42% of Australian businesses are operating without any business interruption insurance are taking a chance with their business. If you have Business Interruption Insurance how do you know its is set up correctly? Did you get advice from your Insurance Broker or simply give someone your Turnover or Profit figures? Take into consideration that 70% of businesses that incur a major loss to their business fail within 3 years of restarting simply because they didn’t have appropriate cash flow to get back on their feet properly after the loss. This could be they didn’t have the cover set up properly, they didn’t have enough cover or they had the wrong sort of policy entirely.

How are you planning to recover from a loss if it happens to you?