Why Choose RGIB as Your Insurance Broker?

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1 Why Choose RGIB as Your Insurance Broker? What good business Insurance is all about!

2 Good Business Insurance The trick to obtaining good business insurance is knowing what insurance you need to have in the first place. Too much insurance costs too much, and not enough could end up costing you everything you have! That s where professional advice comes to the forefront because in recent years, many insurance companies which have traditionally been the risk takers have become direct marketers in their own right. On one hand they want to sell you their promise to cover you; but, on the other they ll fight tooth and nail to reduce their exposure to claims. It s a classic example of giving with one hand taking with the other. As insurance companies look to increase their market share by reducing pricing, they have no other choice but to reduce the scope of policy coverage offered and thus, reduce the incidence of claims, or successful claims. In the late 1970 s and early 80 s there was creep by insurers to underwrite risks at the back end (at the time of claim) meaning that instead of properly assessing the risks offered to them before pricing, they simply tightened up their insurance policy wordings to include tougher exclusions and conditions (fine print) so they could more easily deny a claim on some flimsy trivial misdemeanor. The idea was to get dollars in the door now, and worry about the claims later but in 1984 the Insurance Contracts Act was introduced which went a long way to stamping out that unscrupulous practice however, as evidenced by the collapse of FAI and HIH and the recent flood insurance debacle in QLD, it is clear some of those practices remain but, in a more subtle and sublime manner. In some cases Business Insurance Policies (often referred to as Business Packs ) can run out to 60 pages or more; additionally, where there is a cross over into retail insurance products within the pack there may be an additional Product Disclosure Statement PDS of a similar size; believe it or not, it s all sent to you to make it all easier to understand the insurance product you re buying. But, in reality who really reads their insurance polices? and who really understands them? and besides, who really expects you to? That is the job of your professional adviser called an Insurance Broker. Our job is to represent Your best interests Being an insurance broker is very different to being an agent of an insurance company; because as an insurance broker we re required to act in our client s best interests, not the insurance company s. Thereas, it s the opposite for agents and employees of an insurance company notwithstanding relevant consumer laws pertaining to disclosure and misrepresentation. Getting it right Getting it right from day one (1) is the key to good business risk management; because, if after everything you do as a business owner to ensure your business is secure and operates safely in accordance with relevant product and work place safety laws something goes seriously wrong, you want to know you re fully covered by insurance. Your insurance claim going up in flames is the last thing you want to see... What do you reckon this one hell of an angry claims manager is saying - we know - and it's not pleasant! Why use RGIB as your Insurance Broker Version 5 Current as at 1 Oct

3 We can Customised Your Business Insurance As pricing (even minor variations) becomes more relevant to insurance consumers decisions there is a definite trend towards lower cost direct insurers who proffer themselves as business insurance specialists; AAMI, IAG (NRMA) and GIO are prime examples. But in reality they aren t business insurance specialists ; moreover those companies and their products tend to be aimed at micro and macro enterprises whose insurance requirements are relatively simple;...for instance a home based bookkeeping business or an owner operated hair salon; on the face of things is usually a small enterprise simply requiring:- Property Damage Cover Public Liability Insurance Building structures, contents fixtures fitting, and stock; and (in some cases product liability insurance as well) But, is that all they really need? Every business no matter how big or small is unique, for instance, a hair salon operating on a streetfrontage has a very different risk profile to that of one operating in a Westfield shopping centre; tendency for glass breakage is an obvious difference as is the potential for overnight burglary being on a street-frontage. Direct insurers however generally only have one business insurance policy to sell; they can sometimes add on bits and pieces here and there endorsements to fill gaps in the cover but, they generally don t have a range of products to serve the wide spectrum of business activities out there; and in reality they re not going to recommend a competitor who might have a better cheaper product then theirs whereas, as an insurance broker it s our job to do just that. Additionally, most business owners are time poor and tend to want things done fast, so there is a tendency to trust the phone sales operator they re speaking with despite in some cases that phone operator being thousands of miles away in another country; after all AAMI and IAG (NRMA) & GIO are household names who can be trusted but, that doesn t mean to say the phone sales operator has the relevant professional skills and experience to properly analyze your business risk profile let alone have sufficient local knowledge. The QLD flood cover debacle disclosed that some of these insurance companies employed only very basic qualified staff who told clients that their policies covered flooding but, they didn t explain or understand the exclusions to the purported flood cover, like water escaping or overflowing from a river being an exclusion indeed, some of those customers have a right to feel they were mislead and the courts in some cases agreed but, in most cases caveat emptor applied - let the buyer beware. What is Business Insurance The term "business insurance" encompasses many different types of insurance coverage designed to protect business owners from losses; indeed business insurance policies are usually quite different to other types of insurance. Business Insurance is suitable only, if you own, operate or are engaged in a commercial enterprise such as a business, trade, profession or any incomeearning activity where that income needs to be declared to the Australian Taxation Office. A business activity also includes farming, grazing, agistment of livestock or an agriculture pursuit that earns you money. Through business insurance, you can cover just about any contingency including for property and liability risks as well as for motor vehicles used in the course of business. Compulsory employee insurance (workers compensation/workcover) is also classified as business insurance. Wholesale and Retail Insurance In Australia, insurance intended for commercial purposes is usually referred to as wholesale insurance, whereas insurance for other domestic purposes is usually called retail insurance. There are different rules and regulations for wholesale and retail insurance; for instance retail insurance requires that a Product Disclosure Statement PDS be provided to the client at the time of providing the service, usually held to be at the time of providing an insurance quote. The concept is that an ordinary person does not have the prerequisite skills, knowledge or experience to decipher and understand the nuances Why use RGIB as your Insurance Broker Version 5 Current as at 1 Oct

4 and technicalities of an insurance contract s wording notwithstanding the plain English rules. However, as mentioned above, the provision of a PDS didn t seem to help the flood victims when their claims were knocked back; in reality it s simply too much to expect of an ordinary person to read and understand hundreds of pages of technical jargon. Ironically, that very same person buying retail insurance may also be a small business owner/operator and thus, when considering a business insurance policy they don t get a PDS because of the commerciality of the transaction; persons in business are expected to act in a business like manner and seek professional advice where they need to. Things like that can cause real difficulties for persons whose business has a direct relationship to their personal assets; an example being a famer. The farm is a commercial enterprise and their home is a domestic asset each requires different policies of insurance but, if not insured correctly one cover might unintentionally void the other. Someone running a home based business can fall into that trap because a number of domestic polices exclude customers visiting which could mean you re on your own if a customer visits you at your home office and suffers an injury or loss where you become legally liable. As your insurance broker we ll do the ground work for you; we will likely already have similar businesses to yours on our books and will be familiar with the types of risks associated with your business. However, as mentioned every business and enterprise is unique; and there are more than seventy (70) insurance companies and insurance underwriting agencies operating in Australia; each specializing in certain market segments; and all of whom are vying for your business. In most cases, obtaining an insurance quote is free of charge and without obligation. In short, having good business insurance is all about the principle of indemnity, simply explained as financial restitution to a level just before the loss occurred. You can also go one step further and take out insurance for Agreed Value and/or for replacement cost New for Old however, there are costs considerations in what a small business can afford for their insurances, but a good insurance broker can structure an almost tailor made insurance program for most clients at an affordable price; and if need be premium can be financed with easy to manage monthly installments. The main types of Business Insurance There are many types of business insurance polices worth considering; the following types are what might generally be considered as the most popular:- Cover for Business Assets:- Property - General Property Risks Property Damage Cover including building structures, contents fixtures fitting, and stock Fire and Perils Damage to fixed assets caused by a range of nominated risks. Industrial Special Risks Fire and Perils and Accidental Damage to fixed assets; including Buildings and Property. Burglary Theft of property following forcible and violent entry to premises. Fidelity Indminifies from loss of money, securities, or inventory resulting from employee theft embezzledment and general dishonesty. Glass Damage to fixed Money Loss or damage to cash, cheques, negotiable instruments. Theft Theft of property in open air and/or without forcible entry Tools of Trade Covers tools of trade etc away from business premises. Why use RGIB as your Insurance Broker Version 5 Current as at 1 Oct

5 Cover for Liability and Indemnity:- Public Liability Covers you and your business against the financial risk of being found liable to a third party for death or injury, loss or damage of property or 'pure economic' loss resulting from your negligence. Products Liability Covers legal liability either at law or under guarantee to repair or replace detective products made, sold or distributed by the Insured. Professional Indemnity Financial loss arising from an error or omission in the provision of professional services of an organisation. Directors & Officers Liability Damages following a wrongful act committed by the directors or officers of a company. Cover for Loss to Business Earnings:- Business Interruption Loss of income or Loss of Rent and increased expenses due to damage to fixed assets. Cover for Business Vehicles:- Commercial Motor Covers loss or damage to vehicles used for business and includes cars from fleets, vans, light to heavy vehicles and mobile machinery. Other Types of Business Cover commonly taken:- Personal Accident & Illness Death or disability following an accident or illness (cancellable contract). Audit & Investigation Expenses due to unexpected audits required by any statutory body, including Australian Tax Office. Catastrophe Insurance Cover for a large scale destructive event, in the area where the insured situation is located or as a consequence of such event, and the relevant government authority has declared a state of emergency. Contingency Insurance A secondary insurance coverage which will protect an insured's financial interest if the primary insurance coverage does not respond to the loss for one reason or another. Contractors' Plant & Machinery Loss or damage to unregistered mobile plant, drilling rigs and the like, including plant hired in and out. Electronic Equipment Material damage and/or loss of data following breakdown or malfunction. Laptop Covers Laptops & electronic equipment whilst in transit etc Key person Cover Provides lump sum to cover cost of replacing a key person, compensate business owners for loss of profits. Machinery Breakdown Cost to repair following mechanical or electrical breakdown of plant and equipment. Marine Cargo/ Transit Damage to goods whilst in transit, by road, rail, sea or air Product Recall Expenses Expenses incurred in the recall of detective products. About Rural & General Insurance Broking Pty Ltd RGIB RGIB is one of Australia's most innovative insurance brokers arranging more than AUD$5.5 Billion insurance cover for a wide range clients engaged in all manner of business and commercial enterprise. We can usually provide a complete solution for all your business insurance needs. To learn more about Why You Should Choose RGIB as your Insurance Broker please visit our website at If you are starting a New Business find out how RGIB can help you get it right from day one. In most circumstances quotes are provided FREE and without obligation. We hope the information contained on this page has been of constructive benefit to readers. Should you require any further information about business insurance or any other matter to do with insurance please feel free to contact us on our Toll Free Number or on our website Why use RGIB as your Insurance Broker Version 5 Current as at 1 Oct

6 Our contact details All enquiries concerning this Privacy Policy should be directed to the Director of our National Head Office:- The National Director Rural & General Insurance Broking Pty Ltd Level 1, No 3 Victoria Road Parramatta NSW 2150 Postal Address:- The National Director Rural & General Insurance Broking Pty Ltd GPO Box 3595 Sydney NSW 2001 Phone: Int Phone: Fax: office@rgib.com.au Web: This information applies to all divisions of RGIB /END/ Why use RGIB as your Insurance Broker Version 5 Current as at 1 Oct