When you’re running a business, you want to ensure all assets are protected regardless of future circumstances. It goes without saying, one of the most important things to get right to protect and help sustain your business is insurance.
Insurance brokers are professionals who specialise in providing expert advice in risk and insurance. An insurer is a company which is licensed by the Australian Prudential Regulation Authority (APRA) to underwrite insurance policies (effectively ‘creating’ insurance policies – signing and accepting the liability that goes with them). Insurance brokers act on the behalf of their clients to communicate with insurers – brokers must hold an Australian Financial Services Licence (AFSL) and meet a strict set of obligations.
Insuring through a broker
It’s an insurance broker’s job to work alongside clients to act in their best interests. They are enlisted to communicate with clients to learn and understand the ins and outs of their business, and try to get them the most appropriate insurance cover at the most affordable price. Of course, the main thing nagging insurance-buyers is the fact that brokers charge a fee on top of the policy’s normal premium – which is how they make a slight profit. What is less known about the broker fee is that it often coincides with a lesser premium, because the broker has already pre-determined a price for the required cover, meaning more often than not that the overall premium is cheaper because the broker has organised a cover that is adequate, yet free from unnecessary add-ons.
Why choose a broker?
- A broker will help you identify the risks specific to your business and help you decide what to insure.
- A broker can assist in the claims process, and provide important technical advice to ensure you’re claiming for the right things, and for the right amount.
- Brokers are aware of the terms and conditions, benefits, exclusions and costs of a wide range of competing insurance policies, so they can help you find the most appropriate cover for your own circumstances.
- Brokers can help arrange and place the cover with the chosen insurer, they can ‘shop’ various insurance markets for you and often provide advice on how to make the most of your insurance budget.
- Some insurance policies can be complicated, and an insurance broker can help you understand the details of a policy and also work out what level of cover you need, so that you can make sure you are properly protected.
- An insurance broker can save you time, money and worry. A broker can help you understand the cover you need, and can purchase that cover for you from the insurance market.
Choosing a broker
Just like with any business relationship, you want your experience with an insurance broker to enrich your company. It’s important to choose a broker that you feel is a good fit for your business and will engage in close-communication with you and your team. The following are good things to find out about potential brokers:
- The broker’s qualifications
- Their range of services
- Who would service your account
- Level of experience with your type of business
- The size of the broker’s typical client
- The payment methods they support
- References from satisfied clients
Insurance Brokers in the Franchise Space
The Australian franchising sector is diverse in nature and includes industries ranging from home maintenance to retail services. As with insurance companies, insurance brokers can choose to specialise in certain sectors or focus their efforts on servicing clients across a number of industries. National Franchise Insurance Brokers is one of few insurance brokers in Australia that specialises in the franchising space – offering covers relevant to a range of business types that are also suited to the ‘blanket’ nature of franchise groups. The insurance professionals at NFIB have extensive experience working in the franchising sector, and know how to get the best deal by using group-pricing structures. Basically, by bulk-buying premiums, NFIB can drive the cost of premiums down – meaning the larger the group, and the more people signed on as part of a group, the cheaper the price of insurance.
So before choosing your broker, do your research. Decide which aspects are the most important to you and make a decision. If you’re a franchisor looking to add an extra value to your franchise model, then choosing a broker that understands franchising would be the right idea. If you’re a single business owner, on the other hand, then a general insurer or a broker that specialises in privately owned small businesses might be the way to go. Each business type is different and requires a different approach to insurance matters.