Is the cheapest deal always the best deal?

 

Buying insurance is easy, but buying the right kind of insurance can be a bit more difficult. There are hundreds of companies all willing to give you their “cheapest quote” or “best deal”, but is what is cheapest always what is best?

All insurance policies serve to provide a guarantee of compensation for specified loss, damage, illness or death in return for payment of a specified premium. Where they all differ is in which of those specified events are included in the cover. You may have cover on one policy for many things that you wouldn’t have cover for on another, but they will both be presented to you as “an insurance policy”. So how can you be sure you are buying a policy that provides not only the cover you need, but also the cover you want?

If you don’t spend the time explaining your exact demands and needs to your broker then they can only provide you with an insurer’s standard policy which may be adequate for a large range of businesses but not specifically designed for yours. While a standard policy may offer a quick, cheap option, they are not tailored to your specifications and therefore may not offer the same protection as a bespoke policy from your Broker. Generally speaking, the more detailed your policy is, the more security and protection it will offer your business.

Despite this, according to recent industry research only 38% of Care Home Owners consider the cover provided to be the most significant factor in deciding on an insurance policy. If you compare that to the 61% of those surveyed that consider price to be the most important factor when choosing a policy, it’s easy to understand why so many Care Homes end up under insured. A pre-packaged policy won’t cost as much as a bespoke policy, and it won’t take you as long to get a quote – but it also won’t be built specifically for your business and your needs. If you don’t take the time to discuss all of your needs with your broker and explain exactly what it is you expect from your insurance policy then you are forfeiting the opportunity to develop a comprehensive insurance package that adequately addresses your businesses demands.

Care Home Owners are feeling the pinch from all angles at the moment, so it’s understandable that many would see their insurance policy as a suitable area to trim the fat. You are legally obliged to have insurance for your business, and as such it is often viewed as a “must have” rather than a “want to have”. Because of this attitude towards insurance, many Care Home Owners focus on what they must insure rather than what they want to insure. It can be very tempting to just cover the bare minimum to ensure you are legally compliant and not really explore all the options that are available that could be more suitable to the Care Home that you run. With the rising costs of running a Care Home it must be incredibly tempting to choose the cheaper option over the more expensive but more comprehensive cover being offered, but if your business were to experience a incident or event not covered or inadequately covered by a policy purchased with price as the main priority, it could end up costing your business more than you may have saved by choosing the cheaper policy.

There are many options for a Care Home Owner when it comes to choosing an insurance policy. That’s why it is essential to discuss all of your options with your Broker rather than just choose the cheapest policy available. Spending slightly more time and money on a policy could be the difference between successfully pursuing a claim and significantly losing out financially if you don’t have the right cover in place.

  • Before approaching your broker for a quotation, speak with people within your company who may be more informed of your insurance requirements in areas that you may not be – your accountant, care manager, maintenance people etc.
  • Start your process by designating a budget for your insurance package, and make sure that your Broker is aware of that budget. This will allow them to source quotations within your price range, but it will also help you to choose the policy which is the best value, and not just the cheapest.
  • Take the time to discuss you required cover with your broker. Be prepared to spend anything up to an hour going through the quotation process. It is important that your Broker understands your requirements exactly.
  • Give the same amount time to your broker when they are presenting quotations to you. It’s easy to “switch off” after hearing the premium, but it is important that you fully understand the options being given to you.
  • Take your time with your decision. Don’t be afraid to ask as many questions about the quotations being offered as you feel necessary.
  • Ignore the premium until you understand the cover being offered. List your quotations in order of how they best suit your needs, and then compare the prices. Move down that list until you find the best cover which fits within your budget range.

At Aldium we offer a completely bespoke service to our clients. We take our time collecting quote information from you so that we can gain a full understanding of your exact demands and needs. Our underwriters will source a policy for you that meets those expectations and our consultants will guide you through selecting the most appropriate package for your business.