Q: What is the benefit of using an Insurance Broker?
A: The advantage is that we have qualified specialists in all aspects of insurance and can identify areas of risk in your business which may lead to an exposure or even a claim at a later date. In the event of a claims, we will assist you with the process and ensure a speedy outcome. We assess our business and negotiate competitive terms with a number of insurers in the market and explain your policy to you. Your broker works for you, offering you informed and independent advice.
You’ll benefit most from using a broker by developing a close working relationship with them. This is assist them in understanding your future plans, your associated risks and how you like to do business.
Q: Is an Insurance Agent the same as an Insurance Broker?
A: No. There is a big difference between the two. An agent acts on behalf of an insurance company and can only access products from that particular insurer. We are not tied to any insurer and is obliged to act in your best interests meaning we can approach a number of insurers to arrange the best protection at a competitive price.
Q: What is meant by your Duty of Disclosure?
When you apply for insurance, and during the period of your policy, you have a duty of disclosure. This means you must disclose/tell us everything you know that an insurer would want to take into account when considering your application for insurance or determining the cost and terms of your application.
If something happens at any time that you think may influence how the insurer may have underwritten your policy or affected whether they would have insured, then this duty means you are bound to let us know about it. Examples can include criminal convictions, traffic offences (other than minor infringements), modifications to your vehicle or home, changes in business activities and locations.
Q: Should I increase the sum insured of my home if I make an alteration to it?
Yes. If you are about to make any alterations or improvements to your home, you will need to contact your broker. There are other implications when building and making alterations such as the requirement of Contract Workspolicy and you will also need to factor the value of these improvements into your home insurance policy.
Q: What is the difference between Burglary and Theft?
Burglary is determined by whether violent or forcible entry or exit has occurred. Theft has no physical signs of entry or exit.
Q: What is the difference between Reinstatement and Indemnity?
Reinstatement cover means that the insurers will pay to replace the item with a new one which is equal to but not better than the item lost or damaged.
Indemnity basis means that the insurance will only pay for the second hand value of the item i.e. what you might get if you sold it.
Q: Will taking a higher excess reduce my premiums?
In most cases yes. By accepting more of the risk yourself, a percentage discount can sometimes be applied to the policy. Sometimes however, higher excesses are applied by insurers with no premium saving. This is usually in situations of high risk; e.g. older buildings, flammable construction materials or a poor claims history.
Q: Why do I have to complete a Fire Service Levy Declaration every year for my Business Insurance?
Fire Service Levies are calculated on the Indemnity Valuewhereas a specific insurance contracts might be on a replacement/reinstatement value basis. This includes your commercial assets such as buildings, plant, equipment and stock. By completing a declaration, your levies will be charged in accordance with the Fire Service and not in accordance to the policy sum insured (if on a replacement/reinstatement basis)
Q: How does a Site excess work?
Previously natural disaster losses were based around a percentage of the actual loss occurred following an event. Since the events in Christchurch insurers have moved to a ‘site excess’. Essentially this means that, regardless of the amount of loss sustained, your excess is a percentage of the total sum insured at that site.
Q: What is a DEE report (Detailed Engineering Evaluation)
This is a detailed evaluation completed by a qualified structural engineer, usually commissioned by the building owner.The objective of a DEE is the same as an IEP (Initial Evaluation Procedure).In assessing the building’s structural performance, there may have been some conservative assumptions used during the IEP process and a DEE will address these assumptions.
A DEE will generally cost more than an IEP and will show the same information as in the IEP report, although with more detail.
Q: What is an Earthquake Prone Building?
Under the Building Act 2004, a building may be classified as ‘earthquake-prone’ if in a moderate earthquake it would be likely to collapse causing injury or death, or causing damage to any other property. A moderate earthquake is defined as ‘in relation to a building, an earthquake that would generate shaking at the site of the building that is of the same duration as, but is one-third as strong as, the earthquake shaking (determined by normal measures of acceleration, velocity and displacement) that would be used to design a new building at the site’.
Essentially, what this means is that a building is ‘earthquake-prone’ if fails to meet 34% of the current New Building Standard (NBS) because it would be likely to collapse in a moderate earthquake.