Does my business need insurance?

- Hello, and welcome to Ask Kochiewhere we answer a video questionsent in from one of our viewersToday we have a question from Bernadette,let's take a look- Hi my name is Bernadette Hardy,from interior and product design studio, Bellwood HardyWe focus on interiors that areboth commercial and residential,and also furniture and lighting productsthat suit both applications, commercial and residential

My question is relating to insurancesfor interior design servicesDo we need insurance?How much does it cost?Is it commercially viable?And does it depend on the scale of the job?- Thanks for sending that in, BernadetteInsurance, you never need ituntil you've gotta make a claimIt is a great question

To help me answer it,I have Robert Kelly, the Chief Executive of Steadfastwith 45 years of experience in the insurance industryRobert, you don't look that old(laughing)- Thank you Dave, I appreciate that- Great question from Bernadette

Does her business need insurance?- If she's got a strong balance sheet,she doesn't need insurance,but my experience over quite a few yearssays that small to medium enterprise clientsdon't have good balance sheetsSo when they have got risk exposurefor their material assets and their liabilities,they need insuranceAnd a small business like thathas very complex ways it goes about doing it's businessAnd various covers that they needso for a small amount of money,they can transfer that risk to an insurerand go home and sleep at night,and take the responsibilities awayfrom should we or shouldn't we?So, in reality it desperately needs it

- Yeah, and insurance is one of thoseline items isn't it?That as a small business ownerand say you've got cash flow problems,you look at it and go

insurance, do we need that?But, when something happe

ns to your businessit can actually send you broke if you don't have it- The problem is that small to medium enterprisebusiness is always struggling for cash, okay

And so sometimes they slip up,and they do not put the money into insurancethat they should and then they hit a wallwith a problem and there's nobodythere to save them with that problemSo, nowadays you can amortise the cost of insuranceover 12 months and really in the scopeof what people are doing, it's avery small percentage of their outlieFor a small business like Bernadette's,it would be in the scope of whatshe would spend nowhere near the costof running a car or anything like thatSo, it's a great way to get the risk off you,and to put it on to a strong balance sheet

- Okay, so Robert, why would Bernadetteneed the insurance broker ratherthan say buy it online as we're encouragedto do with our personal insurance?I suppose businesses are a bit more complex, aren't they?- Yes, buying online puts you in the positionof deciding whether the product thatyou're gonna get is suitable for youChoosing to have an insurance broker act for youmeans that they look at what your problems arein your business, your exposures,and they tailor make a policy for youthat will respond at the time of the claimThe added advantage of that of courseis that at the time of a claimthey become the claim advocateSo if you're a small business owner,and you have a claim and youget back on to

com cheapest insurancein the world, whatever it might beThen if you're gonna take the timeoff your business to actually tryand work through when a claimshould or shouldn't be paidThen at the end of that day,you may be frustrated and haven'tgotten any awarenessLike any physician, you need tohave an expert helping you when it's complex in business

- Robert, thank you for that, great adviceBernadette, I'm sure that helped,let us know how you go, and for everyone else,I'll see you next time