The top factors that affect your business insurance premiums

Posted on May 12, 2023 | by | Posted in Uncategorized

Starting a business or running a business consists of several elements. Employees, equipment, premises and much more must be accounted for in minute detail. Insurance is another crucial company outlay that cannot be overlooked. You hope you will never need to claim, but the consequences of not having the right policies in place when you need them can be catastrophic for the company and its capital. Business insurance is generally centred around potential property damage, liability and other potential issues dependent on the area of business.

Factors that will affect how much you pay for business insurance include but are not limited to:

Your area of business – The sector in which you operate will affect the cost of your insurance. For example, businesses that hold high-value stock such as jewellery, designer clothes or computer equipment may have to pay a higher premium than those that operate in different areas. Liability insurance is another example of how premiums can vary from sector to sector, with higher premiums for those that operate in higher-risk sectors such as the security or construction industry and lower premiums for office-based businesses.

Your business location – It is widely acknowledged that some areas of Australia are more prone to natural disasters than others. If your business premises are in a high-hazard area noted for bushfires or floods, you can virtually guarantee that your premium will be higher than those running a similar business in a low-risk area. Areas with a high crime rate can also affect the cost of property insurance, although the premium can sometimes be reduced with the right security systems in place.

Your insurance provider – Like any product or service you buy, some providers offer better value for money than others and this includes the insurance industry. Although you generally get what you pay for in terms of cover, exclusions etc, savings can sometimes be made if you bundle your business insurance in Perth or anywhere else in Australia, meaning that you buy all your insurance from one broker instead of several. This also saves time when dealing with the provider, as you’ll usually have one point of contact for all enquiries, payments and claims. Local brokers generally offer higher service levels when compared to national and multinational insurance providers.

Prior Claims – Every insurance company or broker will study your previous claim history when assessing the cost of your premium. Previous legal issues, constant machinery breakdowns and other issues that may have occurred in the past will all impact the cost of your insurance. Again, this may vary from provider to provider, so if you have a history of claims, it’s prudent to shop around.

Type of Cover/Period of Cover – As previously mentioned, the type of cover you require for your business will affect your premium. Regarding the period of coverage, many insurance companies offer a more competitive premium for an annual policy paid in one lump sum rather than a monthly recurring payment or similar arrangement. But it is worth noting that to stay competitive, some insurance companies may charge the same overall premium, whether paid annually or incrementally.

If you are looking for an experienced business insurance specialist in Perth or the surrounding area that can meet your needs, the team at Matrix Insurance can help. Using the information you provide, we will scour the market on your behalf to get you the best level of cover for your business. Get in touch to talk to one of our advisors or complete the online enquiry form for an obligation-free quotation.