Having an insurance policy in place is one of the most important parts of running a business but often it is accompanied by much confusion. Navigating through all the different options to choose from can be difficult and understanding those differences in policies can leave you wondering which one truly offers the best cover for you.

In this article Towergate Insurance outline some of the key points you need to be aware of when it comes to insurance.

Choosing the right ‘business interruption’ indemnity period

When looking for the right insurance policy for your business, you may find that some policies on the market offer a 12-month business interruption indemnity period. As important as getting the sum insured right is ensuring that you have the right indemnity period for your business.

Due to the nature of potential claims, 12 months may not be long enough for essential work to be taken up and completed and a 24-month business interruption period can be considered and discussed with your broker.  

Why is this period important?
There’s a lot that can happen to a business that is not the fault of anyone, but rather caused by things outside of an organisations control, such as weather damage, demolition and more.

For a business with a 24-month indemnity period, they would be covered for two years for any work that needs to be completed to the building to get it back to how it was before the incident, including securing the same number of residents.

Beware of underinsurance

With the increasing cost of labour and materials globally, it is vital care homes ensure their buildings are sufficiently insured. It is solely the policyholder’s responsibility to ensure that the property is covered correctly.

According to Rebuild Cost Assessment, nursing and care homes are the fourth most likely building type to be underinsured in the UK*.

(*This data is derived from RebuildCostASSESSMENT.com’s most recent report, detailing 34,145 Rebuild Cost Assessments completed as of 31st August 2024)

To avoid underinsurance, businesses are encouraged to have valuation surveys undertaken at least every three years. These valuation surveys will be able to consider any changes in the market that may have affected rebuild costs.

Please note, your building sums insured should be based on the reinstatement cost rather than the market value and if your property has features, restricted access or is a listed building, this could further impact the rebuild cost too.

Find out more

For more information on how Towergate can assist you with finding the protection your business truly needs, contact James Anscombe 07967 850015 / james.anscombe@towergate.co.uk