Mark Bramley, area director at Gallagher, held a recent workshop held in NSW facilitated by Tony Khoury, Executive Director, WCRA NSW.
Along with many other industries the waste and recycling sector faces challenges with obtaining insurance cover and increases in premium rates.
Realistically, businesses should be prepared for premium increases of at least 10-15 per cent. This is due to a number of factors. Claims for natural disasters have eaten into the pool of funds reserved for paying claims, with the result that insurers’ profits have more than halved. The recent fires, cyclones and storms have inflated claims for damaged buildings and plant, while liability in all areas have also contributed to the cost of claims.
From the insurer perspective, property damage and business interruption top the risky exposures list, followed by management and public liability, employment liability, equipment breakdown and cyber security breaches.
In addition, access to insurers has reduced both in Australia and overseas as the same issues affecting the waste and recycling business sector are being experienced globally.
As a result, all businesses should be prepared for ongoing premium increases for property cover, challenges in obtaining full capacity of protection with higher excesses being applied, and increased scrutiny on liability cover
How can waste and recycling business owners obtain the insurance cover needed and keep a lid on premium costs? Here are some tips:.
- General risk maintenance: compliance with the NSW fire safety in waste facilities guidelines and Management and storage of combustible recyclable and waste materials guidelines are steps you can take to reduce property risks.
- Ensuring that all workers are suitably trained in the policies and procedures of the business along with ongoing training around risks.
- Ensuring that all machinery, equipment and vehicles are used and maintained in accordance, with the requirements of the manufacturer.
- Ensuring that all conditions of licences and consents are compiled with.
- Ensuring security protections are adequate and properly maintained, and that combustible materials are dealt with appropriately.
- If your bottom line capital supports it, you may benefit from increasing your excess/deductibles to reduce your premium by having the business take on some added risk.
- Ensure you’re not selling yourself short, review your sums insured amounts to – ensure they are current with repair or replacement costs.
- Ensure your documented business activities truly reflect your operations provided to your insurers because omissions or misrepresentations could cause claims to be denied.
- Consider what you claim. Consider whether it is worth claiming small claims just above excess. Large claims will impact renewal premium and acceptance. Similarly with multiple claims for the same event or type of risk.