Business Insurance....What are you covered for??

Commercial Insurance…are you covered?

“Canada’s insurers and intermediaries need to find creative solutions to ensure that Canadian businesses can access the insurance they need.”

See a copy of report here

Summary from Report

The core objective of commercial insurance is to financially protect businesses and non-profit enterprises against the insurable risks that they face. Currently, the Canadian commercial insurance market is facing a period of significant change. Several sizable external pressures are negatively impacting insurers, intermediaries, and their clients and creating tension in the commercial insurance market.The Canadian commercial insurance market became a “hard market” in 2019, which means the market entered a period of higher rates and reduced underwriting capacity for certain lines of business and/or geographies (e.g., commercial property). Years of insufficient underwriting profitability, driven by rising claims costs, and low returns on investment led to an overall decline in net income between 2015 and 2019 for property and casualty (P&C) insurers. The environmental and macroeconomic events of 2020 have exacerbated these market dynamics, driven by three immediate pressures:

 

Basically this all means that you, as a business owner, are going to be paying more for your insurance. 

The forecasts indicate that the increases will continue until late 2022.  Another hard hit on business.

Business Loss deals with physical loss/damage and a Pandemic does not fall under this purview.  The same applies to Business Interruption Endorsement.  The pandemic affects more than just your business.  The Endorsement does not get activated unless the Business Loss portion is activated.

From 2001 to 2010 $400M in claims were issued across Canada.  From 2011 to 2019 $1.9B claims were issued across Canada.  In 2020, across Alberta alone, $2B in claims were issued.  This created the “Hard Market” that is spoken about in the Summary/Report.

What can you, as the business owner, do about it?

• Make sure you take the time to discuss your coverage with your broker.  Get more than one quote.  Yes, it is going to take time, but time well spent!
• Make sure the broker knows your business.  Make them a part of your Risk Management Team.
• Develop a Risk Management strategy!
• Talk with fellow business owners and see what they have found.
• The Insurance Bureau of Canada (IBC), has setup a program to assist Canadian businesses that need advice or financial aid on their insurance.    Contact the IBC, they are here to help!

Businessinsurancehelp.ca     - 1-844-2ask IBC  (1-844-227-5422)

 

In some provinces there have been class-action suits filed against insurance companies.

• Class action launched against insurers that won't pay businesses for coronavirus-related losses   Saskatchewan 
• Class action suit in BC

 Even though they have been filed/launched, it will take some time to go through the law system and come back with a verdict.  That doesn’t help the here and now.

What to do today:

You need to look after your business.  

Make sure you are aware of what is in your policy and work with a broker that understands your business!  

Take a look today and see what is in your policy.  Just renewed?  

Make sure you understand why the changes occurred..contact your broker!