Accuracy matters: submitting business Insurance information

Just over half of business owners are worried about making a professional mistake. And it’s understandable — busy business owners have so many things to organise aside from the day-to-day running of a business! Insurance is one of those boring tasks that no one wants to do, and it’s easy to slip up on an online form when arranging it as there are so many questions.  

Does it really matter what your building is made out of? Yes, it does. 

Giving the wrong information to a broker or insurer could come back to haunt you down the line. In this guide, we’ll explain why.

Why is business insurance important for SMEs?

Insurance for SMEs is important because it can protect your employees, your customers, and your bank account. If you were to make a claim or someone made one against you — the right business insurance cover would protect you — meaning your insurer would deal with the claims and pay any compensation without you being left to pick up a hefty bill. 

It can also protect you against legal action in case you or your employees give out the wrong advice or make a mistake that leaves someone with losses to account for. And if you have more than one employee, who isn’t family, it’s a legal requirement to have employers' liability business insurance!

What could happen if you submit incorrect information when arranging insurance? 

We know mistakes happen, but you could pay the price later on if you submit incorrect information about your business to your broker or insurer. Here are five main issues you may come across: 

• Claims denial - If you don’t tell your broker all the correct details when arranging your insurance package, and you need to claim down the line (or someone makes a claim against you) – it might be refused. This means your insurer won’t pay out, and you’ll be left to deal with it. 
• Policy cancellation - Because your information is incorrect, your policy might be cancelled, and you could have issues with suspected fraud, even if you made an honest mistake. Read up on why honesty is the best policy in business insurance.  
• Unable to renew - Because your policy has been voided, your insurer may not offer a renewal policy. This can leave you uninsured and without cover.  
• Increased Premiums -  If the details you’ve submitted are incorrect, this could mean your premium is cheaper because it doesn’t cover you fully. If you can get alternative insurance, then it’s likely your premiums will be higher. We know premiums tend to rise every year, but don’t be surprised if yours suddenly goes up!

How to avoid submitting the wrong information 

We know you might have an employee or manager try and sort out your insurance needs, but sometimes this can go wrong, as they might not know all the details of your business.  

When speaking to a broker or insurer, you’ll want to ensure you’re submitting the right information. 

• Keep important information to hand - You may be asked specific questions about your business activities, wages, and turnover when sorting out insurance. Having these files open and ready will mean you’ll be prepared, spend less time on the phone and more time running your business. 
• Be honest and transparent - When a broker guides you through the questions about your business, you should answer to the best of your knowledge. We know it might seem tempting to answer in favour of a cheaper premium but it’s really not worth it — you might end up having to pay out yourself. 
• Understand the needs of your business - Sometimes, getting details incorrect is an honest mistake. If you don’t actually know which types of insurance your business needs, you can easily take out the wrong policies. That’s why it pays to speak to someone who can help ensure you have the right insurance package — like a broker. 
• Know the value of your business - If you don’t know the value of your business assets, how do you know how much to claim if something goes wrong? Knowing how much your equipment and tools are worth is key to ensuring they’re insured. A business valuation provides an accurate assessment of your business’s value. In some cases, insurers might require a valuation on paper to tailor policies to your specific needs. Learn more about valuing your small business. 
• Review the small print - Whenever you receive a written document from your broker or employer, check the details are correct and as you agreed. You might receive multiple documents, including a Statement of Fact and policy details. It’s your responsibility to check the policy wording and summary! You should also check you get an employer’s liability certificate.  public liability certificate.  
• Keep a log of your up-to-date business information - Keeping a digital log of all your business information is useful in all sorts of situations, including arranging your insurance, but also in case you need to make a claim! 

Imagine your small business floods, and you are unable to operate. You evacuate your building, taking staff and customers with you. You need to alert your insurer but your paperwork is in an office draw and is now ruined from the flood! In this scenario, it’s best to have a digital copy of all your documents easily accessible. You can create a folder in an online cloud drive (like Google Drive) to keep all your documents. Make sure you put your insurer's phone number in your mobile phone so you don’t waste time searching for it when an emergency strikes!

What information do you need to provide for business insurance? 

You’ll need to provide the following details to your broker or insurer when arranging or renewing a policy. It’s best to have this stored in a digital file and update it regularly! 

• Annual turnover 
• Employee wages 
• Your wage 
• Start date of trading 
• Number of employees 
• Value of stock and contents 
• Previous claims or incidents at the property 
• Business address 
• Building structure and materials 
• Current insurer (if applicable) 
• Current renewal price (if applicable)

What should you do if you’re unsure how to answer a question on the insurance application? 

Speak to an insurance broker or an insurer if you are having trouble filling out insurance forms online. 

There isn’t always a one-size-fits-all insurance package for every business and not all questions are included in online applications. That’s why it helps to speak to someone directly on the phone who can learn about your business and advise on the best solution. At Bionic, we use smart technology and our knowledgeable insurance team to help our customers compare business insurance and arrange a deal. Start a quote online today.

What factors can influence the cost of business insurance? 

A business insurance package can vary depending on so many factors, but here are some of the main ones: 

Industry 

Every business presents different types of risks. And some industries are just more riskier than others.

For example, a trade like carpentry will have more injury risks than a small office environment. Since working with tools in a workshop is riskier, you’re presented with issues like tools overheating, and working from heights on stools or ladders can increase your premiums. 

Just like restaurants, chip shops and cafes that have deep-fat fryers in kitchens, they can greatly increase your risk of fire and, in turn, increase your premiums. 

Not only that, but if you’re a financial advisor, therapist or in any profession where you’re giving out expert advice, then this poses different risks. If you were to give out incorrect information and a customer acts on it,you could be faced with fines as a result. In this case, it’s best to take out professional indemnity insurance to cover your back in case an employee goes rogue. 

Business size 

A large industrial business is likely going to cost more to insure than a tea shop run by a family because it’ll have many more employees than a microbusiness.  

Revenue, sales and employees are just some of the factors that could affect how much insurance you pay and which policies you take out. 

And if your business has grown from last year, then it’s normal to expect your premium to be more expensive! 

Type and amount of cover you need 

There are many types of insurance policies out there, and the likelihood is, you won’t need all of them. 

A digital marketing professional won’t need stock insurance, just like a freelance writer wouldn’t need building insurance.  

It can be difficult to know which types of insurance are essential for your business, that’s why it’s often easier to look at packages insurance based on trades. These are tailored solutions based on industry and the scope of cover needed. 

Sometimes, a specialist insurance policy is needed, like for invasive beauty treatments, and this can make premiums more expensive. Generally, the more policies that are taken out, the more you can expect to pay. 

Claims history 

Has your business previously claimed? This is taken into account by insurers when you renew or take out cover. If you’ve claimed before, you are seen as more of a risk to insurers and insurers may bump up your premiums or decide not to insure you at all.  

If you’ve had a claim previously rejected and some reason, you can’t get insured. Read up on our guide on what to do next if you’re business insurance is refused. 

Business location 

Just like your address can impact your personal car insurance quote, where your business is located can equally have an impact on your premiums. If you’re located near a river or ‘flood zone’ then insurance costs may be higher due to the level of risk.  

Learn more about protecting your business from floods, storms and bad weather.

Protecting your business with support from Bionic  

No one wants to be accused of fraud when making a simple mistake on an insurance form! But you don’t have to do it all alone, Bionic can help you find the right business insurance by working with a panel of trusted providers and arranging the right package to suit your needs. Start a quote with us today and speak to our knowledgeable insurance team.  

Interested in more resources for small business insurance? Head to our insurance guides now.