One of the biggest concerns during these unprecedented times of countries implementing strict lock-downs, is how customers are treading the waters of insurance.  Now more than ever, South African businesses need to ensure that they are adequately insured to prevent any further losses.

Insurance cover is not a one-size-fits-all approach. Rather, your coverage is likely to comprise a personalised range of products and levels of cover. In a sense…to build your own unique cover structure.  This approach can be confusing for the average consumer, but there is a very good reason to applaud this ‘build-your-own coverage’, and that is flexibility. Like pieces of a Lego set, it is important to put the right building blocks together to create the coverage that best suits your needs and circumstances.  Interrogate your policies and make a checklist of what is covered and what is not.  This way, you can pick up on where you are left most vulnerable and take steps to mitigate the risk. This would be where a good Broker comes in handy. You need to fully understand the risks without making assumptions.

At Vision we ensure that our clients know all the facts before they take out a policy, and that they understand all the risk categories applicable to their business.  During lockdown we have been able to assist our clients by adjusting their cover to suit their current requirements.  With a big portion of our clients we went from cancelling certain types of cover that they did not need for a specific period (to reduce cost) or in some stages adding cover as certain risks might have increased due to lockdown.

A few examples of this would be:

Restaurants

This industry totally closed down and is still not fully operational.  For these clients we kept the bare minimum (like fire and theft) and started to add cover back when the businesses, for example, changed to only take-aways, etc.

Pharmacies

Clients in this industry were actually doing much more turnover and even needed extra cover in some instances (stock and cash in transit).

Communication will always remain key and it is very important that clients always make an informed decision of what they are canceling as insurance is largely a grudge purchase, but when needed it is invaluable. Often we hear: ‘For the 10 years I’ve had this insurance I’ve never used it’ or ‘I never use it, I’m going to stop’, and then two days later your car is in an accident and you have to pay for it yourself because all those years of premiums have, effectively, been flushed away due to the cancellation.  These can be hard discussions to have, but the key is to ensure that your valuable assets are always protected.

How you assemble your insurance building blocks depends very much on your needs at a particular point in time. Remember you can switch out blocks and use bigger and smaller components as you choose, just make sure you create a fortress of cover large enough to protect your business at all times. This, together with good risk management practices, updated safety training and a solid business plan for the “new normal”, can ensure that your business comes out of the current storm stronger and more accomplished than before!

Author: Elrine Eckert (Short term broker – Vision Insurance)