Beware of signing contracts that leave you exposed for public liability
February 2nd, 2010 by anne.
Most businesses wisely take out Public Liability insurance. This type of insurance protects the business against the legal liability to pay compensation to another for bodily injury or damage to property arising out of an occurrence in connection with the business.
But where things can get ‘sticky’ is when a business owner signs a legally enforceable contract that adds extra liability risk or exposure that their public liability insurer may not have been informed about nor approved.
What types of situations do we mean by this?
A common example is the signing of a property lease. It is typical for the lease to include a provision that protects the landlord against a liability claim within the leased portion of the premises. That is, the landlord is not exposed to pay compensation unless it is of the landlord’s making.
But in some cases, certain landlords are extending the tenant’s liability to include other areas not under the direct control of the tenant. For example, a customer of the tenant may park their vehicle within the building’s car park and, whilst on route to the tenant’s business, suffer an injury. Clearly, the injury occurred in an area not under the control of the tenant. Under the terms of the lease however, the tenant becomes liable as the customer’s purpose in attending the building was to visit the tenant’s premises.
Unless the tenant’s insurer was advised of this additional liability exposure and had agreed to insure the additional risk, a claim under the tenant’s liability insurance would not be valid.
All public liability policies exclude claims where the policyholder has accepted liability in circumstances where liability would not normally have attached in the course of the policyholder’s business. The actions of a policyholder accepting liability under a signed contract will more likely than not, trigger a policy exclusion meaning that indemnity is denied.
In the course of running their business, many business owners sign various types of legally enforceable contracts. In some cases, they may have unwittingly accepted additional risk exposure. Contracts can include those signed with suppliers, customers, employees, landlords and more.
There is a tendency often excused by the lack of time and cost not to refer the contract to a lawyer for review. Many business proprietors simply skim through the pages of contract legalese (if at all) and just sign on the dotted line. In doing so, the business owner could well be leaving their company exposed to a public liability claim that is not covered under their policy. And this can be an incredibly expensive error with crippling effects on the business’ viability.
So what to do? We recommend that you always ask your lawyer to review any legally enforceable document you sign, to identify if you are accepting any risk of exposure to a financial loss. If any risks are identified, it is important to determine if the risks are insurable by referring the contract to your insurance broker. Sometimes, the additional risk is unwarranted and it is not unusual to have the offending clauses removed or altered. In any event, the extra risk assumed is often insurable by payment of an additional premium once you have advised your public liability insurer and had the situation assessed by them.
Another area where businesses can strike difficulties is when they engage contractors to work in or around their premises, including those engaged via labour hire entities.
If a contractor is injured on your premises, this may trigger a workers’ compensation claim against their employer (the labour hire entity). But often, workers’ compensation insurers will subsequently seek recovery of the outlays they have made if the injury arose from unsafe work premises or contributory negligence on your part. The injured party may also make a claim directly against you. Many public liability insurers are denying claims of this nature where they have not been advised that an additional risk has been assumed as a result of the contractors being engaged to work on the site.
It is worth noting that cleaning and gardening contractors fall within this category.
For your protection, it is important to discuss with your insurance broker, the insurance implications of any contracts you enter into.
In most cases, cover can be arranged so long as you have provided your insurer with details of the contracts. In this way, they can assess the risks involved and determine if an additional charge is required to cover the extra exposure.
Enjoy clear peace of mind when it comes to your insurance protection.
Contact us to find out more about ensuring that the contracts you enter into do not jeopardise your public liability insurance.
A good broker can boost the likelihood of a successful claim
January 29th, 2010 by anne.
One of the ways that an experienced broker delivers greatest value is by helping you to successfully navigate the claims process.
Time and time again, we have been able to show our clients how they qualify for a claim – even in situations where they were not sure they were covered. We have then been able to help them to present the facts to the insurer, which in most cases has resulted in a payout.
Take for example the story of an heirloom ruby ring, owned for decades by a Sydney woman. Sadly, the woman died in her 60s after a long battle with cancer. Her grief stricken husband placed her engagement, wedding and eternity rings as well as the heirloom ruby ring on a gold chain which he wore around his neck – in an act of defiance at being separated.
Two years passed, during which time he reorganised his affairs including fresh home insurance with a different insurer, using us as his broker. The estate wound its way through probate and the division of tangible assets progressed. There came a time when it seemed appropriate to hand the ruby ring over to the next generation; their daughter.
The daughter took the ring to be cleaned and appraised by a local jeweller. The jeweller reported that unfortunately the ruby had a crack in it and was now worthless.
Was this an insurance claim under a home insurance policy? Even our client was sceptical.
The ring was old and in the jeweller’s opinion, the fracture was caused by an impact incident; an incident no one could recall. More than likely, the unnoticed damage had occurred many years ago. Why should the insurer for the last two years be responsible?
This is where our in-depth knowledge of the terms of the home insurance policy came to the fore. We were able to explain to our client that the loss occurred at the time the damage was first noticed by the insured. This meant that even though the actual damage had most likely occurred many years before, the loss had arisen during the time of cover with the current insurer.
We helped our client to successfully submit their claim. The result was the insurer settled with a payment for a replacement ruby stone at a cost of $4,100.
A different result may well have been the case if the claim had been presented without assistance.
An experienced broker has the skills to understand the fine detail of the insurance contract and can help you to present the facts to an insurer in the best possible light. And this is often the difference between the claim being accepted or denied.
Contact us for all types of insurance advice that will give you the best chance of success when it comes to claim time.
Eight reasons why you should source your office insurance through us
January 5th, 2010 by anne.
Every type of office insurance contract is different. And for most people, the idea of sitting down and carefully reading through terms and conditions – let alone comparing them across policies – is like drawing teeth. But to make sure you actually end up with cover that will protect your business when things go wrong, it is vital to get the detail right.
That’s where officeinsurance.com.au comes to the fore.
Here are the eight top reasons for arranging your office insurance through us:
1. We reduce the complexity: Our job is to evaluate the terms and conditions of office insurance policies available within the Australian market, and to identify those that we believe offer the best terms and value for our clients. This means that when we recommend a policy for you, you can be assured that we have gone over it with a fine tooth comb to make sure it can deliver what you need. This eliminates the guess work for you, as well as the hard task of trying to evaluate various policies yourself.
2. We help identify exactly what cover you need: With decades of experience specialising in the insurance needs of office-based businesses, we have a keen understanding of what questions to ask you to clearly identify what risks your business may be exposed to and to assess the true value of your important operational assets. This means we can advise you on the right type and amount of cover, so that if you need to make a claim, there will be no nasty surprises.
3. We’re your advocate – and we will go to bat for you when needed: As a broker, our primary duty is to you, the client – not the insurance company. With decades of experience, we have the experience and connections to push the insurance company on your behalf if we need to – and to get a result in your favour.
4. You have access to a full range of office insurance products: Compared with dealing directly with an insurance company, when you speak with us, you gain access to a range of office insurance products from across the market, not just the limited range offered by an individual insurer.
5. Good prices, great value: As a broker, we can generally source office insurance for you at wholesale prices – so that even with our fee included, you end up paying around the same price as if you had gone directly to the insurer. In this way, you get the benefit of tailored, impartial advice and the right policy for your business – all at a very competitive price.
6. We help you keep your cover up to date: Every year, we review with you what changes you have experienced in your business (e.g. a change in services you offer, an increase in staffing or additional fixtures or equipment). This means that your cover stays up-to-date with your business as it develops.
7. Advice is just a phone call away: You have year-round access to our specialist office insurance advisers so that you can contact us in the event of a claim or any time you need advice about your insurance cover. We see ourselves as part of your risk management team.
8. Expert advice to help make claims easier: If you need to make a claim, we are fully conversant with every aspect of your cover. This means that we can make sure you receive all the benefits you are entitled to. We also can guide you through the process so that the claim is finalised as smoothly as possible.
As the old saying goes, insurance is like a parachute: you only find out how good it is when you need to use it.
That’s why it simply pays to make sure the office insurance contract you sign up for will deliver the right type and level of cover your business needs to get through a difficulty you can insure against.
Contact us for customised, unbiased advice so you can be sure your office insurance is the right fit for your business.
Office Insurance Offerings
Business Interruption
Business interruption insurance can provide a financial stop gap until operations can return to normal.
Employee Dishonesty
Employee dishonesty insurance can cover your business for the theft of your property or money by an employee (acting alone or with others).
Machinery Breakdown
This insurance covers the cost of repairing machinery, such as air conditioning, plant and refrigeration equipment that has occurred as a result of a breakdown.
Property
Property insurance can cover for loss of or damage to property at your premises arising from an event that is sudden, unexpected or unforseen.
Specified Property
This section of your office insurance enables you to nominate specific items of property that can be covered when held within or beyond your premises.
Computer & Electronic Equipment
This insurance covers loss of income, additional expenses incurred to repair the equipment and the costs associated with restoring lost data arising from the breakdown of electronic equipment.
Glass Breakage
Glass breakage insurance covers the accidental breakage of all internal and external fixed glass, toilet and hand basin porcelain, glass signage, mirrors and similar.
Money
Money insurance can cover loss or damage to money or negotiable documents as a result of theft or loss, destruction or damage caused by any accident, not otherwise excluded.
Public Liability
Public liability insurance can cover you for your legal liability for personal injury to a person or damage to a person’s property caused by your business.
Taxation Investigation
Taxation investigation insurance provides cover for all necessary costs reasonably incurred in the completion of a tax audit or investigation by a statute body.