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The Stormy Reminder

The Stormy Reminder INSURANCE Security alarms and fire sprinklers businesses with contents worth less than amounts of stock or loss of profits through interruption of trading. £50,000. can only provide limited protec­ A typical policy covers stock, fix­ Small claims can often be dealt with tio n against business hazard — as tures and fittings against fire, explosion, by post. The policyholder lists loss or the gales earlier this year brutally lightning, theft, aircraft damage, riot damage on a claim form, describes the demonstrated. For firms who and civil commotion, impact by road cause and attaches relevant repair haven't yet learned the lesson of vehicles, storm or flood and water estimates. under-insurance the hard way, damage. The policyholder should quickly put here is some advice from Harold in hand any emergency work needed to If any of these insured perils puts the Hobson, general insurance manager protect his property from further policyholder out of action for any of Legal and General. damage, but await the insurer's author­ length of time, he is covered for loss of isation before beginning other work. profit — known as a "consequential In cases exceeding £100, the insurer loss". Liabilities to employees and the will usually send a claims inspector to public are also covered. THE insurance industry paid out more view the damage or appoint an indepen­ A number of optional extras are dent loss adjuster to deal with the claim. than £20 million to commercial and available covering, for instance, personal The adjuster's job is to assist the domestic policyholders for damage and accident following robbery, or deterior­ loss inflicted by the gales and floods policyholder and insurer to agree a fair ation of stock in frozen food cabinets. early this year. and reasonable figure for damage and, If the policyholder owns the building It is often only when such disasters where appropriate, financial loss caused from which he conducts his business, he by interruption to business. occur that financial failings — or can insure it against the same perils as strengths — come to light. Fortunately, Often, an adjuster will identify losses the contents. most commercial policyholders have overlooked by a policyholder and is as Normally, the policyholder is asked enough business acumen to know that likely to increase a claim as to decrease to pay the first £15 of any claim for insuring their property and possessions it. storm, flood or burst pipes. This is adequately is as important as locking He may well need the help of the known as an "excess". them up. policyholder's accountant. Businessmen should remember to In times of high inflation, however, The adjuster will also give advice on value buildings and contents adequately even businessmen who insured for the any immediate action necessary, such as and buy cover for the full amount. This correct sum at the outset rapidly drying out materials and the disposal of will provide the full settlement in the become underinsured unless they revise salvage. event of a claim. their policies frequently. When investigations are complete, an In 1975, for example, building repair adjuster will agree figures with the Policyholders who underinsure their costs rose by about 30 per cent, and the policyholder, and ask him to sign an property may find that the insurance cost of an average mix of fittings by acceptance note, which is passed to the company scales down any claim, what­ about 20 per cent. insurance company with his report. ever the size, in direct proportion to Many small businessmen who When the policyholder's cheque the amount of underinsurance. escaped the storms with their businesses arrives he should not overlook the need Thus, if they have only half the intact must be wondering how much to reinstate his cover, as it will have necessary cover, they will receive only help they would receive should they half the amount needed to put right any been reduced by the amount of the ever be hit by disaster. loss or damage. claim he has just made. The answer, of course, depends on When disaster does strike, it is import­ NOTE: costs of package policies for the type of policy they took out — and ant for the policyholder to claim quick- small businessmen vary from area the amount of insurance cover they to area and business to business. ly. bought. Example: a London grocer might pay Accountants can play a key role in Many large insurers issue package £1 per £100 of the value of the con­ the presentation of many commercial tents of his shop. ■ policies which meet the needs of claims, particularly those involving large 8 INDUSTRIAL MANAGEMENT http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Industrial Management Emerald Publishing

The Stormy Reminder

Industrial Management , Volume 76 (6): 1 – Jun 1, 1976

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Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
0007-6929
DOI
10.1108/eb056636
Publisher site
See Article on Publisher Site

Abstract

INSURANCE Security alarms and fire sprinklers businesses with contents worth less than amounts of stock or loss of profits through interruption of trading. £50,000. can only provide limited protec­ A typical policy covers stock, fix­ Small claims can often be dealt with tio n against business hazard — as tures and fittings against fire, explosion, by post. The policyholder lists loss or the gales earlier this year brutally lightning, theft, aircraft damage, riot damage on a claim form, describes the demonstrated. For firms who and civil commotion, impact by road cause and attaches relevant repair haven't yet learned the lesson of vehicles, storm or flood and water estimates. under-insurance the hard way, damage. The policyholder should quickly put here is some advice from Harold in hand any emergency work needed to If any of these insured perils puts the Hobson, general insurance manager protect his property from further policyholder out of action for any of Legal and General. damage, but await the insurer's author­ length of time, he is covered for loss of isation before beginning other work. profit — known as a "consequential In cases exceeding £100, the insurer loss". Liabilities to employees and the will usually send a claims inspector to public are also covered. THE insurance industry paid out more view the damage or appoint an indepen­ A number of optional extras are dent loss adjuster to deal with the claim. than £20 million to commercial and available covering, for instance, personal The adjuster's job is to assist the domestic policyholders for damage and accident following robbery, or deterior­ loss inflicted by the gales and floods policyholder and insurer to agree a fair ation of stock in frozen food cabinets. early this year. and reasonable figure for damage and, If the policyholder owns the building It is often only when such disasters where appropriate, financial loss caused from which he conducts his business, he by interruption to business. occur that financial failings — or can insure it against the same perils as strengths — come to light. Fortunately, Often, an adjuster will identify losses the contents. most commercial policyholders have overlooked by a policyholder and is as Normally, the policyholder is asked enough business acumen to know that likely to increase a claim as to decrease to pay the first £15 of any claim for insuring their property and possessions it. storm, flood or burst pipes. This is adequately is as important as locking He may well need the help of the known as an "excess". them up. policyholder's accountant. Businessmen should remember to In times of high inflation, however, The adjuster will also give advice on value buildings and contents adequately even businessmen who insured for the any immediate action necessary, such as and buy cover for the full amount. This correct sum at the outset rapidly drying out materials and the disposal of will provide the full settlement in the become underinsured unless they revise salvage. event of a claim. their policies frequently. When investigations are complete, an In 1975, for example, building repair adjuster will agree figures with the Policyholders who underinsure their costs rose by about 30 per cent, and the policyholder, and ask him to sign an property may find that the insurance cost of an average mix of fittings by acceptance note, which is passed to the company scales down any claim, what­ about 20 per cent. insurance company with his report. ever the size, in direct proportion to Many small businessmen who When the policyholder's cheque the amount of underinsurance. escaped the storms with their businesses arrives he should not overlook the need Thus, if they have only half the intact must be wondering how much to reinstate his cover, as it will have necessary cover, they will receive only help they would receive should they half the amount needed to put right any been reduced by the amount of the ever be hit by disaster. loss or damage. claim he has just made. The answer, of course, depends on When disaster does strike, it is import­ NOTE: costs of package policies for the type of policy they took out — and ant for the policyholder to claim quick- small businessmen vary from area the amount of insurance cover they to area and business to business. ly. bought. Example: a London grocer might pay Accountants can play a key role in Many large insurers issue package £1 per £100 of the value of the con­ the presentation of many commercial tents of his shop. ■ policies which meet the needs of claims, particularly those involving large 8 INDUSTRIAL MANAGEMENT

Journal

Industrial ManagementEmerald Publishing

Published: Jun 1, 1976

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