AVOIDING COMMON SME CLAIMS

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Top 5 small business claims and how to help your clients avoid them

Knowing the most common claims made by small businesses helps you advise your clients on how to expect the unexpected and protect themselves against the most common risks.

As an insurance broker, you’re there to help businesses understand their coverage and mitigate their risk as much as possible. Based on the top 5 small business insurance claims, below is some advice you can give your clients to help them do their bit to safeguard what they work so hard for.

 1. Theft and burglary

  • Check that your clients have installed security cameras in and around the premises.
  • Remind them to close all doors, windows, and other access points whenever the business is unattended – and to make sure adequate lighting is installed both inside and outside the property to deter trespassers.
  • Talk to your clients about enlisting the help of employees to look out for theft. You could also recommend they conduct background checks on their employees.
  • Ensure businesses have a system for tracking and managing their inventory.

2. Storm damage

  • Encourage businesses to consider the geographical location of the premises, looking out for any storm damage risks like nearby trees or elevated areas that would hinder storm water run-off.
  • Advise your clients to check that their property’s roof, gutters, and eaves are in good condition; to trim any overhanging tree branches; to secure any loose objects that could become dangerous in high winds; and to anchor any outdoor equipment or material.
  • Recommend that your clients prepare a plan for an extended power outage, considering things like where any perishable stock would be relocated. Also speak to your clients about possibly arranging Business Interruption cover.

3.  Property damage (accidental and malicious)

  • Encourage clients to keep their premises well-maintained by proactively repairing small issues before they become more serious.
  • Just like you’d advise your clients to regularly check their electrical equipment, they should also be guided to check any water related devices,, including fixed hoses and flexi-hoses to avoid burst pipes. Not only can water cause damage to your client’s property, but it can also cause harm to nearby properties, which your client is liable for.
  • As well as discouraging theft and burglary, security systems might also prevent vandalism or other malicious damage to the property.

4.  Machinery and equipment breakdown

  • Encourage your clients to proactively check and maintain their machinery and equipment, storing them properly, and keeping electrical connections clear of any dust and obstruction.
  • Remind clients that, where applicable, equipment is to be used only by experienced and trained operators in the way it was intended to be used (i.e., not run at over-capacity or used in unfavourable environmental conditions).
  • Advise clients to heed warning signals and replace worn parts as soon as possible.

 5.  Liability

  • Remind clients to keep workplaces safe for their employees and customers by making sure walkways and floors are dry and clear of tripping hazards, and lighting is adequate to prevent slips, trips, and falls.
  • Dangerous areas of the business containing machinery or hazardous materials should also be restricted.
  • Recommend that your clients put in place systems to ensure that their clients’ property is handled with care and diligence. Employees should also receive adequate training of these systems.