We often get asked questions like “why do I need to get my extinguishers serviced”. One of the common responses given from the industry is that it’s a requirement for your insurance. I have often wondered about the validity of this comment, so in response I have interviewed Kim from Alan Wilson Insurance Brokers about this topic.
Kim is the General Manager of Alan Wilson Insurance Brokers.
Alan Wilson Insurance Brokers (AWIB) offer a wide range of services that suit your specific needs.
These include the following services:
• Risk Assessment
• Insurance Advice
• Claims Handling
• Premium Funding
• Insurance Presentations
• Access to Industry Specialists (Loss Adjusters, Valuers, Investigators, Risk Minimisation Specialists)
Alan, himself, is a Director of the Fire Protection Association (FPA) Australia and runs a group insurance scheme for FPA Australia. As such the team at AWIB have intimate knowledge about fire and its impacts.
FESSA: If I don’t install the fire equipment required by my building approval and there is a fire what will the impact be when I make an insurance claim?
ALAN WILSON: If a fire was to occur and there was incorrect fire protection or no fire protection, which led to extra fire damage occurring to the building then, the insurance company may deny a claim in part or in full.
FESSA: Does this also apply with regard to the maintenance of the fire equipment?
ALAN WILSON: Yes, if the fire protection equipment is not maintained to the correct standard and a fire occurs, then the insurance company may deny your claim in part or full.
FESSA: If my fire protection maintenance provider does something wrong, such as leaves a flat fire extinguisher in place, and there is a fire will my insurance claim be honoured?
ALAN WILSON: Yes, provided you don’t know that the maintenance provider has completed the error. The insurance company would pay the claim and then seek recovery from the maintenance provider or their insurance company. However if you know about the error, and take no action at all and this leads to further damage to the building than what would have been done, due to the fire protection equipment not working properly, then the insurance company can decide if they pay the claim in part, full or not at all.
FESSA: What happens if my fire contractor is not correctly insured and we have a fire? Does it only cause problems if something they have/have not done is contributing factor to the fire?
ALAN WILSON: You should check to make sure your fire contractor has the necessary insurance required and obtain proof of this insurance. If a fire occurs and you are insured, your insurance company will investigate the loss and if they find that your fire contractor was responsible in full or part, then your insurance company may try and recover all or part of the claim from the fire contractor.
FESSA: If I was a small business operating from a workshop/office, what type of insurance should I have?
ALAN WILSON: Insurance is all about risk management. Firstly, you must assess your risk and then consider what things you don’t want to pay for yourself. This is normally passed off to an outside company and normally done by an insurance policy. The normal insurances undertaken would be Business insurance on your building, stock and contents, business interruption insurance, theft insurance, plate glass insurance and Public & products liability insurance. Various other insurances are available and could be considered depending on the type and size of the business.
FESSA: How do I know if the insurance I get is correct for my needs?
ALAN WILSON: Although insurance can be purchased by various ways, example, on the internet, by the insurance agent, direct with an insurance company or through an insurance broker. Each has their advantages.
Internet – this is easy and normally cheaper as you are going direct online to the insurance company. However, how do you know the product is right for you. You have no one to talk with or get advice from. Is it the best?
Insurance Company – The insurance company is the body which takes the risk, however they are not there to give advice about their products or insurance in general. They provide you with their product disclosure statement (insurance policy) and you need to read this yourself to ascertain if their product suits you
Insurance Agent (Authorised Representative) – This person acts as the agent for the insurance company and not you as the client. They can only sell you their company product and cannot give the advice you need as they act for the insurance company.
Insurance Broker – The insurance broker is the only true independent person who deals in insurance. They must have insurance qualifications and they act for you, the client when arranging the insurance. They do not act for the insurance company. The insurance broker can deal with many insurance companies. As he acts for the client he will assess the client’s insurance risk and needs, then search the insurance market for the best product suitable for his client.
FESSA: How do I know if the insurance company I’m using is reputable?
ALAN WILSON: Insurance is governed by the Australian Security and Investment Commission (ASIC) with each Insurance Broking Company and Insurance Company requiring a licence to trade. Strict compliance procedures exist for each of these businesses. To further protect the consumer the insurance companies must pass a financial test to make sure that they can safely trade. This is controlled by the Australian Prudential Regulatory Authority. (APRA). To further safeguard the consumers insurance companies can under a Standard & Poors financial test and be granted a credit rating. This credit rating is published and freely available to all consumers.
FESSA: Thanks for answering those questions, where can people get in contact with you if they want some assistance with their insurance?