Have you prepared your business insurance for growth?It can be exciting to be the owner of an expanding business, but there are a number of things that need to be thought about. The business may require more staff, a new office or premises, and it may even become necessary to think about international travel. But, it is important to remember that new opportunity brings new risks. Expanding companies must update their insurance accordingly in order to accommodate growth. Forgetting to do so could mean you are underinsured or even void your current business insurance.
Last year, Brecon Foods, specialists in the production of baby food products, and nutritional meals for the NHS, experienced some of the insurance problems that expanding businesses can face. Brecon Foods decided to purchase a facility, which they had previously used to outsource their food production – so they could have a manufacturing facility of their own. The previous owner of the facility had decided to sell their business. So, by purchasing it themselves, Brecon Foods were hoping to inherit a fully operational factory with all their insurances transferred across. For a number of reasons they were mistaken. Their insurance provider refused to insure them in the new facility.
Dealing with a difficult situationThere was a significant danger that the company would have to delay starting trade until adequate cover was found. Fortunately, someone had recommended Jelf to one of the Directors at Brecon Foods.
Within a week, Jelf had looked into the market and found a suitable insurer who had extensive experience in the food manufacturing industry. It was Jelf’s industry experience that was key. It allowed them to access the cover and advise Brecon Foods on the mitigation of risk, including product recall, ISO accreditation and staffing. This was to ensure the cover would be affordable in the long term.
Brecon Food’s decision to take on a factory of their own and manufacture their own food proved to be the right one. It was a potential risk. And, there was some uncertainty before an insurer could be found. But, the business is now stronger than ever and is achieving its objectives. In fact, business is going so well for Brecon Foods, that a major retailer has recently agreed to stock their food range and there are further plans to expand this range in the future.
Growing business? What should you do
It is a good idea to keep the following points in mind when expanding your business. Check and make sure your business is prepared for any insurance risks:
- Firstly, inform your insurer about any changes to your business. They can advise you on the best course of action and update your cover accordingly.
- Make sure you understand the law, especially if you are expanding your business into a new sector or marketplace.
- When growing your workforce, make sure you fully understand your responsibilities as an employer: pensions, HR, CPD opportunities.
- Adjust your insurance to cover any changes to the structure of your business. An example could be a new Board of Directors.
- If you have decided to make your small business independent from a larger company – inform your insurer and adjust your insurance.
- Many things can affect your business, ask for support from insurance experts you can trust and avoid being caught out.
It is essential to keep your business insurance up-to-date, as your company continues to grow. Doing so will help to insulate you from costly claims. It will also prevent you from voiding your insurance, so you can concentrate on growing your business. At Jelf we build relationships with our clients, getting to know their business, keeping up-to-date with business developments, and advising accordingly as their businesses grow.
For more information and advice, don’t hesitate to get in touch with us!
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