Barnes Commercial writes:
Just as it sounds, Loss Recovery Insurance is designed to help with recovery from a disaster, getting a business up and running again as fast as possible. It is available for commercial property, material damage and business interruption losses and can also cover home buildings and content claims. Typically, Loss Recover insurance becomes applicable when a claim is more than £5,000.
Loss Recovery insurance has been specifically designed to help you to do all of the above as quickly and easily as possible and provides many business owners with peace of mind. It could prove invaluable if your business should suffer from disaster, which could be anything from a flood to a fire.
So what does Loss Recovery Insurance include?
What’s included in your policy will differ per provider, but looking across the board on typical components, a loss recovery package is likely to include a dedicated loss adjuster who will assist you through the entire claims process.
Having someone to guide you through the process at a time of heightened stress will be invaluable. Loss adjusters who respond to LRI claims are likely to be on-site and with you within hours of the reported claim. This fast response is what the policy is all about. The reassurance that an insurance professional will be available to help you look at exactly what has been lost, what needs to be dealt with immediately and to negotiate on your behalf for the best and fastest claim outcome.
A dedicated loss adjuster will also help with your communication strategy; advising staff and clients on the situation and how it will be managed.
You may need to find suitable new premises to operate from in the interim period and equipment or stock may need to be replaced quickly, so you can continue to deliver your services. An impartial and calm head to help you manage your claim quickly and effectively will really aid the recovery of your business.
Why do you need it?
Imagine that your work premises are completely gutted from fire. Not only have you lost your building, but all the contents too, which could include expensive equipment, stock or supplies and business operating systems. All your client data could be lost. There will be so many questions to answer: what would happen to your staff? Can you afford to pay them whilst you find a new workplace to operate from? How will you contact your clients to let them know?
It sounds extremely stressful and something we hope never happens, but on rare occasions it does.
Loss recovery insurance works alongside your business continuity plan ensuring a fast response at the time of crisis, which can make all the difference. Providing reassurance to your customers is vital, so they know what’s going on in relation to the service or product you provide.
With the support of a dedicated loss adjuster you will be kept up to date on how your claim is progressing. This support will allow you to focus on the day to day running of your business whilst they professionally prepare your claim and negotiate on your behalf.
According to research carried out by Lorega (one of the UKs leading providers of loss recovery insurance), 55% of SMEs who had a claim over £5k and who did not have specific loss recovery insurance, were unhappy with their claims service from their insurer.
This is likely to be because they didn’t have an appointed loss adjuster who would be with them throughout the entire process. Having an expert on hand to answer your questions and coordinate your claim can really take the pressure off because understanding your insurance cover and the claims process can often prove a challenge.
Additionally, in this research Lorega found that only 16% of businesses had a loss adjuster visit within 24 hours of the reporting of a claim. You really need an immediate response, so your claim and recovery can be started as soon as possible.
With loss recovery insurance, your dedicated handler will be in constant communication with you and on-site as much as possible too. In Lorega’s research, communication was top of the list of expected levels of service by SMEs when they come to make a claim, but nearly 60% of SMEs said they had no regular communication from their insurer on the claim progress.
A bad claims experience can result in additional stress at a time when it’s really not needed. The longer your business is not fully operational the more opportunities there are for rival businesses to poach some of your clients. It can also put pressure on time and resources and bring additional financial strain. For many, it’s difficult to carry on with life as normal whilst an insurance claim is going through.
It's all about business survival
Disaster recovery is all about business survival. The focus of loss recovery insurance is on loss mitigation and business recovery, to ensure the long-term growth and stability of your business.
Loss Recovery insurance is not compulsory but can make life a lot easier to handle if you decide the investment is worth it. And if you think it’s an unaffordable luxury, think again. Premiums are often less than imagined and you may be able to spread the cost with a finance option.
If you decide that LRI is something that you should invest in, do your research. Make sure the cover is underwritten by A rated insurers. If the premium seems much cheaper than the nearest competitor then it may be underwritten by a non-rated insurer, which may leave you exposed should a claim be necessary.
Check that the loss adjuster will be dedicated to your claim, with you and regularly onsite throughout your claim. You’re paying for someone to effectively hold your hand through a crisis, so you should make sure that they will be available when you need them.
Ensure that they cover your area! If there is a geographical limitation on the coverage, then you could be left high and dry.
At Barnes Commercial, we believe that all businesses should have access to expert help and advice when they need it. This is why we have partnered with Lorega who provide an award-winning loss recovery service for claims of £5,000 or more.
In our opinion, Loss Recovery Insurance is an invaluable additional cover for you to consider. It is available to clients that hold a commercial combined policy with us and provides complete peace of mind should the worst happen.
Click the link for more information on Loss Recovery Insurance.