Reviewing your cover once a year

7 days ago
3 min read

Updated: 1 day ago

Introduction

A renewal notice arrives, the premium is broadly similar to last year, and it is paid. The process takes four minutes and involves no consideration of whether the policy still matches what the business does. Price is the only variable anybody examines, and it is the least important one.

Meanwhile the business has taken on three staff, started a new service, bought equipment, begun working at height, and holds twice the stock it did. Insurance renews automatically and businesses change continuously, and nothing in the process connects the two. An hour once a year closes that gap entirely. There are few administrative tasks with a comparable return.

1. Reviewing your cover once a year means checking the business, not the premium

Reverse the usual approach.

Renewal is normally treated as a price comparison. The more valuable exercise is establishing what has changed in the business and whether the policy still reflects it, and price is a secondary question after that.

2. Start with what changed in the last twelve months

The list that drives everything.

New services, new equipment, more staff, different premises, higher stock, new types of customer, new contracts. Write it down before looking at any policy document. Starting from the policy anchors you to last year's business.

3. Recheck every sum insured

Where the largest exposure sits.

Buildings at current rebuilding cost, contents and equipment at replacement, stock at peak, and the business interruption figure and indemnity period. Inflation alone moves these even when nothing else changed. Construction costs in particular have moved faster than most owners assume.

4. Confirm the covers you are legally required to hold

Quick and important.

Employers liability if you now have staff, motor cover with the correct use class, and anything specific to your sector. Businesses cross these thresholds without noticing that a legal requirement now applies.

5. Check what your contracts oblige you to carry

Frequently changes with new customers.

Larger clients and landlords specify covers and limits. A contract signed in March may require something the policy renewed in January does not provide.

6. Look for cover you no longer need

The review works both ways.

Equipment sold, activities stopped, premises given up, or a vehicle no longer used. Paying for cover on things that no longer exist is common and it partly funds the cover you actually need.

7. Read the changes in the wording

Insurers alter terms at renewal.

Exclusions are added, particularly around cyber, infectious disease and specific perils, and cover you had last year may not be there this year. The renewal documentation states this and almost nobody reads it.

8. Ask your broker what you are not covered for

The most useful question available.

Rather than asking whether you are covered, ask what would not be paid. It produces a much more informative conversation and it identifies gaps that a list of policies conceals. Holding four policies tells you nothing about whether they meet between them.

9. Update the summary sheet

The practical output.

One page listing each policy, what it covers, the sums insured, the excess, the renewal date and the claims contact. Produced during the review, it is what somebody can actually use during an incident.

Do the review a month before renewal rather than in the week it falls due. Changes take time to arrange, alternative quotations take time to obtain, and a review conducted the day before expiry becomes a decision to renew unchanged.

Conclusion

Review the business rather than the premium, because policies renew while circumstances change.

List what altered in the last twelve months before opening any document, recheck every sum insured against current replacement and rebuilding costs, confirm the covers you are now legally required to hold, check what recent contracts oblige you to carry, remove cover for things you no longer have, read the changes insurers have made to the wording, ask your broker specifically what would not be covered, update a one-page summary, and do it a month before renewal.