Is “Change” Your Greatest Business Risk?
Change is constant for every business, especially in the early stages of a new venture. In fact, when it comes to finding the right business insurance, the first four years are the most important. A business might establish new markets, move into new premises, purchase more equipment, and hire more staff. These changes produce the greatest potential for profit and success, but also introduce additional risk.
A recent survey of New Zealand and Australian business owners found this four year period to be the riskiest. It’s this period of time when businesses either move to a new stage, consolidate what they have developed so far, or sadly close. As a company grows and the pace picks up, it’s too easy to overlook the fact that small changes can potentially lead to profound risk. From an insurance point of view, I see business owners doing an excellent job of getting cover at start-up but failing to keep pace with the changes in their business, as too often reviews get put to one side and essential business insurance policies missed.
Growing A Business is Risky Business
Risk is part of any business. However, the lack of time and often false sense of security brought about by business growth can lead to mistakes. That’s why it’s vital to update and review cover before situations arise. The problem is that often discussing your business insurance is just another task on top of an already busy to-do list. Finding time can be a significant factor in whether the recommended 12-month review happens. My advice? Don’t leave a review more than every two years, and always keep your Broker up to date with business changes in between times.
Are you prepared for risk as the pace picks up? Ask us about business insurance today.
Top Business Insurance Types Most New Businesses Overlook
Business insurance is complicated. If you’re just starting a new business, it can be tricky to know exactly what you should cover. Left unchecked, your business may no longer be covered for common risks. Here are the options you should consider when your insurance comes up for review.
Statutory liability Insurance
If you accidentally breach legislation, you’ll be covered against legal defence costs and certain fines (excluding Health & Safety), penalties ordered against you as a result of accidental breaches of New Zealand Laws.
Why you need it
No matter what your industry, there’s always a chance you could fall foul of legislation. If you accidentally violate or break New Zealand Law, Statutory Insurance can help make things right.
Business Interruption Insurance
If you’re unable to trade after a serious event, or accident, this could be key to getting you back on track.
Why you need it
In your initial stages of business, you’re unlikely to be making a profit. However as the business takes off, what would happen to you and your business income if something nasty happens. To get the income coming in, you’ll need all the support you can get to cope with lost income and increased expenses.
Cyber Liability Insurance covers your business in the event of a cyber attack. You’ll also get access to experts who can be on board immediately to help you resolve and recover from any breach of your data or website.
Why you need it
Cyber-attacks in 2017 targeted one in five New Zealand businesses. Could yours be next? With sensitive customer data and digital systems which could be at risk of attack, this risk is higher for small businesses. Costs of recovering from an attack could be significant if uninsured. They include hiring IT Security experts, legal fees and damages to get you back running. There’s also the interruption to your business while you respond to the attack, not to mention the impact on your reputation.
Shareholder protection Insurance
If one of the shareholders had an accident, died prematurely or became totally disabled, what would that mean for the future of the business? Shareholder Protection insurance comes in to cover the risks of multiple founders or owners and unexpected life events.
Why you need it
Problems can arise for businesses when an owner or shareholder dies or is unable to work. If shares are passed on to the beneficiaries of their estate spouse/children, this further complicates matters. Shareholder Protection can help protect the capital value of your business, and keep things in check while you manage any change in business ownership.
What’s changed recently in your business?
Every business has different needs. Contact Balance Advisors to work out your risk profile today.
Don’t let change put your business at risk. Get in touch with us today to find out how business insurance can protect your growing venture.