PLANS AND PRICING
Essentials
Annual accounts, tax, gst, plus all your other compliance needs.
Track Your Business
For the business owner that wants a closer relationship with their financial adviser.
Growth & Strategy
For the business owner that wants to set up a strong management and planning function.
129 Kolmar Road,
Manukau, Auckland
P: 279 3787
F: 279 3789
info@quinnbiz.co.nz
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Have You Reviewed Your Insurances?
It is a good idea to review the adequacy of your insurance covers on an annual basis.
The first thing to do is to ensure that any new assets or business locations have been included in the information that is being declared to the insurance company.
Secondly, you should check the level of investment that the business has in a particular asset against the insurance cover that the business has for that asset, for example, when you made your initial insurance declaration, your stock levels may have been in the vicinity of $200,000 but because of changes in the business operation, the stock is now at $370,000. If you do not increase the level of insurance, then in the event of a claim you will be substantially under-insured.
You should also check that the cover for buildings is on a full replacement value basis and that you are not partly insured. Periodically, you should carefully consider what it would cost to replace various buildings and adjust the insurance cover to that amount.
The Annual Insurance Review should be a detailed analysis of all assets that the company owns, together with a listing of the various contingency factors that could affect the business. You need to ensure that adequate insurance covers have been negotiated to protect the business’ position.
Don’t Leave it to Chance
Here are some things you might like to think about when you do your annual insurance review.
Is the sum insured for public liability purposes adequate?
Courts are making larger and larger awards as part of disputes. Many businesses would be relying on their public liability insurance policies to cover such awards. Is your cover adequate?
Do your insurance policies include cover for natural disasters?
Have you implemented a policy for your firm as to what your team members should do in the event of an insurable event occurring such as cyclones, flood, fire, etc? Small businesses have a responsibility to their insurance company to try to prevent further losses and stock deterioration in the event of an insurable event occurring.
If you are insured on an indemnity basis, this means that you are only insured for the basic present day value based on the building that is currently there. That is, if that building is destroyed by fire, a new building has to be erected and therefore you would probably need replacement value policies, not indemnity policies.
Do you need consequential loss of profit insurance?
These are very detailed types of insurance that will require input from your accountant to determine the level of cover for ‘gross profit’, ‘fixed costs’ and some other items. These terms are used in an insurance policy context and do not relate to the normal business use of terms such as fixed costs and gross profit.
Some companies have taken Tax Audit Insurance so as to give them some cover in the event of a tax audit being conducted by Inland Revenue. This would recompense the business for the extra professional fees that it may have to incur for accountants and legal advisors.
Travel Insurance is also a particular policy that some businesses may need to take to effect appropriate cover for directors, management and team members who have to travel on behalf of the business.
Directors And Officers Liability Insurance is also required in many companies, especially companies that are appointing external directors to their businesses. Insurance cannot relieve directors and officers of their responsibilities under the company’s constitution or their legal responsibility. However, there are various circumstances where directors can be liable for matters that have not been committed to by the directors or officers on a legal basis and as such the policy for Directors And Officers Liability Insurance can assist in relation to legal fees that may be incurred by the director or officer because of actions by another party.
The quantum of Buy/Sell Agreements For Partnerships And Shareholdings in companies should be periodically reviewed. However, there may be instances where you are unable to increase the quantum of insurance because of the individuals rating, or some other reason that the insurance company may have that leads them to refuse any further insurance covers on a particular individual.
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