Client Product Library

Client Insurance Product Library As at 10/09/2007

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Client Insurance Product Library

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Insurance Products

Insurance references

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Consideration of cover Business Insurance risks – be warned Protecting Assets - what should be insured?

Risk Management Priorities Legal Entities - recognised for Insurance

6.

A] Asset Covers

B] Liability Covers

¾ About this library ¾ Explanation of words used with the library ¾ Other benefits of Insurance ¾ The Evolution and functions of Insurance ¾ Duty of Care - overriding condition on everyone ¾ Important Notices (Duty of disclosure, Subrogation, 3rd parties, Utmost goodfaith) ¾ Basic principles of Insurance ¾ Premiums - A guide to structure ¾ Sums Insured - A guide to structure ¾ Liability - The concept of Liabilities and Rights ¾ Bailment - Your duty of care as “Bailee” ¾ Claims - Philosophy and General Interpretation Documents listed on our website - www.centralins.com.au 9

Other General information

or

Under the “Products” Icon o Client Product Library – 100+ pages listing all policies with prices o Financial Services Guide – compliance statement about our services o SME basic checklist (1 page summary by Industry of the basic covers). o Insurance checklist (1 page summary by Industry or Occupation) o Product Directory – 1 page list of all policies o Risk Management of a Policy – (critical elements of a policy) o FAQ – using a Broker

Under the “Clients” Icon 9 Client Insurance Manual o Practical daily risk management guide including, Claims procedures.

9 Central Profile – resume about our company 9 Location map to our office 9

Under the “Contact” Icon 9 Staff contacts and resume 9 Team Photos

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Client Insurance Product Library As at 10/09/2007

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Insurance References About this Library We have endeavoured to collate, interpret, record and present a practical guide to General Insurance.

Acknowledgments Special thanks to all the patient and concerned members of our office as well as the various insurance companies that contributed to this publication.

Phillip R Smith FAICD Aff, AII AIM CD QPIB Dip.Fin.Serv(Broking) Founding Director (1978) email Phillip@centralins.com.au web: www.centralins.com.au

Best navigation options:Basic Not sure what covers you need?

9 Go to our website click the link under “Products” –select the option of “O/IRI”. Now select your Industry or Trade to access a 1 page summary of the most common risks. Now you can use that list to view each policy in this library.

Intermediate You have a business and just want to know what’s critical for budgeting purposes?

9 Go to our website, click the link under “Products” –select the option of “SME Crisis checklist”. Now select Industry to access a 1 page summary of critical issues and costs.

Advanced Products in this Library – Click here o Each policy is listed with a basic description, purpose, rating factors and premiums, wherever possible. o We have no control of market changes therefore the information should only be used as a general guide.

Other

General Info about “Insurance” – Click here What other material do we list on our website – click here

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

Copy of this library is on our website

Client Insurance Product Library As at 10/09/2007 1.

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Explanation of Titles used in the Product Library

Policy Divisions - 3 Categories – The policy will cover Asset only, The Asset and/or Liability of the risk or the Liability only.

Settlement – 2 types.

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Replacement - New for Old There are very few contracts that provide "Replacement Reinstatement conditions". The most obvious is Home Insurance and most Commercial policies covering Fire provide "Replacement", provided you allow an adequate sum, otherwise you will be faced with penalties known as "Average" or "Under-insurance" clauses.

Example of "Average" or "Under-insurance" clauses You buy a printing shop with depreciated plant value is say $20,000 The plant is say 10 years old and to replace, with import costs and dollar fluctuations, may be $60,000 Q: How much do you insure for?

A: Obviously $60,000 If you insure for only $20,000 (1/3rd) you couldn't replace your equipment so the insurer has the right to "Average" the claim in proportion (pay only 1/3rd) as you are under-insured. Further examples are noted under "Sums Insured" a guide to structure which is a few pages onward.

9

Market Value (better known as “Indemnity”) "Indemnity" means to put you back to a position similar to that prior to the loss, but without betterment (improvement or profiting from the loss).

Around 90% of policies are settled on "Indemnity" basis

REMEMBER …At all times… the insurer reserves the right to repair, replace or reinstate. This precedent allows the insurer to control the integrity of the insuring public. ie. If you over insure they will repair or replace the item and not pay cash. If you under insure they can give a cash settlement and take the goods as salvage regardless of their condition or apply underinsurance average clauses as appropriate.

Example: If you under insured a car and have a minor accident the insure can deem the vehicle a write off, give you the minimal cash settlement and take the vehicle and auction off to cover their costs.

Levels of cover – 3 categories 9 "Gold" = Broadform or (Accidental Loss/Damage)” 9 “Silver" = Defined Events 9 “Bronze” = Restricted events Rating factors – The information required by the insurer to consider the risk and determine a premium Premium - The costs payable for an Insurance policy Excess - A deduction of a fixed amount to be borne by an Insured in respect of each claim.

In other words if the loss does not exceed the Excess there is no claim.

Situation - - 2 types.

9 Static = Most policies are based on a static risk, that is, they are at one place and therefore cover is not applicable if moved. The obvious examples are:Home & Contents, Business/Office Pak, Contract Works cover.

9 Mobile = Some policies allow for the risk to be moving such as Cars, Boats, Mobile Plant etc.,

Other Benefits of Insurance!

Insurance stimulates Business Enterprise 9

Business loans (capital from Insurance Premiums invested by Insurers) would not be provided and thus private enterprise would not exist. Businesses would not be so competitive for fear of Liability claims.

Insurance Safeguards Capital 9

Businesses would have to freeze capital, instead for a predetermined premium they can obtain security against named risks.

Insurance assists Business Survival 9

It enables businesses to remain in operation after experiencing set-backs from events such as Fires and other property damage.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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The Evolution and Functions of Insurance •

Our forefathers introduced risk sharing schemes centuries ago. They reasoned that some risks do not occur with great frequency, but when they do occur they bring disastrous consequences to the individual. The occurrence of the risk itself cannot be avoided, but if the burden were to be shared by a large group the resulting economic loss could be shared.

The very broad principle on which insurance operates is:Small amounts (premiums) are collected into a large fund (managed by insurers) from many people (insured) to pay losses (claims) for those few who incur them.

Put Simply "The opportunity to transfer your problem/Loss to the insurer".

Philosophy of Insurance - "Everyone contributes a little so no one suffers a lot" Consideration of Cover

Insurance cover will be considered on the principle of "possible" events, but not "probable" events. That is, if the likelihood of loss is so imminent it is no longer a gamble or wager on the part of the insurer and therefore not a risk for consideration.

Business Insurance – Be warned!

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Buying Business Insurance is nothing like buying a Personal (consumer) policy:o A “Private” (consumer) policy such as Home automatically many sections, benefits and sub limits such as: 9 Fire & Perils, Burglary, Glass breakage, Fusion, Liability, Money, Spoilage etc., so your decision is easy, it's just a matter of hoping the limits are enough for your needs ! o A Commercial or Business Insurance - you must decide on each section, and sub-limit as required so you must be attentive to your needs.

Protecting Assets - What should be insured?

Naturally every business requires consideration for a variety of basic covers, however, regardless of the Industry/Process etc., you should always devote a special review of the "Key" issues and/or "Assets" for specific protection. Example:-

Professional: Key assets are 1] Profession so consider "Professional Indemnity" 2] The Qualified Person so consider "Disability" cover, including Outside working hours.

Also consider key tools ie., Dentist; special cover on Compressor or Offices; special cover on computers.

Retail:

Key assets are 1] Location or passing trade, so consider "Loss of Profits" to protect your Goodwill in the event of Business Interruption. Also consider key Plant items which may need special attention.

Manufacturing:

Key asset is plant so also consider Breakdown cover with Consequential Loss in the event of Breakdown or expediting costs. Also Environmental Impairment (pollution) cover.

Transport:

Key assets are 1] Truck so consider "Downtime" 2] The Driver so consider "Disability" cover, with Business Expense benefits.

Risk Management priorities

Identify Key Assets to Protect - Asset Register Y/N Static or Fixed Assets & Personnel Mobile Assets & Personnel Consequential Loss of Income and trauma cost Identify Liabilities created by these Assets Do you know legal precedents

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What do you do “Disclosure” Critical to disclose anything “out of the normal” The exposure What can go wrong, whilst allowing for present and future exposures Direct Liability – your activity; it’s Assets and Liabilities Indirect Liability – operations outsourced or contracted out that fall under your primary operation

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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“what can go wrong”, translates into the Identification, the measurement and the Management of the Risk. Management has two aspects - the control of management systems in place to prevent risk occurring and if something does go wrong, to be able to deal with the damage, and the things you are more familiar (the financial side).

What is it going to cost to Outsource all or part of the risk (Insurance) Versus Your time, effort and stress What do you know about the threat of loss, recovery and recourse (legalities)

Cross reference these issues against your current covers

LIABILITY: do you Always offer instructions (verbal/written)?, Issue a Disclaimer?

Have control of the risk Directly or through sub-contractors (indirect also known as Vicariously)?

Have documented procedures to verify you have a known process?

DUTY OF CARE - an overriding condition on EVERYONE. "What is reasonably expected of a reasonable person under reasonable circumstances". This is the critical deciding factor of most disputes and is the primary method applied by the courts. If your insurer does not believe you have applied this duty when protecting insured items or settling claims then you may be challenged.

This is also the basis of Liability claims for which insurers must defend you should a 3rd party claim arise for loss &/or damages.

Please consider this "duty", which we owe to each other, at all times !

Utmost Good Faith (Latin: umberrima fides) Refer to standard disclosure questions and conditions.

The insured and insurer must be honest and fair with each other as per Insurance Contracts Act. Sections 12, 13,14,21,22,23,24,27,28,37 .

Certain sections have been extracted and published in our client manual under section Part 06

Working with YOUR INSURER -

Laws and Obligations

Basic Principles of Insurance 4 IMPLIED (written) conditions apply, they are:1. Insurable interest 2. There must be physical object capable of being destroyed.

3. The physical object must be the subject-matter of the insurance.

4. The insured must stand in some relationship to the subject-matter, recognised by law, where they may benefit by its safety, or may be prejudiced by its loss.

Indemnity On the happening of an insured event, the insured will be placed in the same financial position after the loss as they were immediately before the loss, subject to the sum insured being adequate.

Subrogation Where the insured has been indemnified by the insurer they must assign their rights against third parties, in respect to the loss, to the insurer so they may recover. DO NOT WAIVE THIS RIGHT TO ANOTHER PARTY AS IT WILL BREACH POLICY CONSITIONS.

PREMIUMS: - GUIDE TO STRUCTURE We have endeavoured to give an indication of Premium for each risk, they are should not be relied upon beyond a guide.

Assessment factors:- Type of Risk, Historical claims, Location, MPL (Maximum probable loss).

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Claims reflect attitude, Having established the type of risk you then consider the claims history for the individual or industry.

Next, depending on the location you may need to add an l The MPL is a very important factor; regardless of how small or large the item there is always going to be a minimum Loss and a maximum probable loss.

Example: Motor Vehicle – Regardless of its value, be it $2,000 or $10,000 if you have an accident “Minimum damage cost” (say $1,500 to $4,000).

The claim costs are against the 1st $1000 sum insured or layer and therefore the bulk of the premium is applied to the 1st $1,000 sum or layer.

The next layer being $2,000 is less likely to be claimed upon the rate is lower and so on. This is why a premium on $2,000 car is not much less than a car worth $10,000.

Another example: Home Insurance. If Sum Insured is $10000 and premium is $100 if you reduced sum insured to 25% $2500 would you only expect to pay $25? Obviously not as there is a minimum premium for admin costs before the rating factor applies.

You will notice this same pattern in all the rates shown throughout this booklet as is the case with all policies. Please also bear in mind that the rates shown would reduce further as you apply it to larger sums insured.

LAYER SYSTEM 1st Layer 2nd layer 3rd Layer 4th Layer 5th Layer

Sum insured 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000

claim cost $2500 $Nil $Nil $Nil $Nil

Premium charged $500 $300 $200 $150 $100

SUMS INSURED: - GUIDE TO STRUCTURE The insurer will indemnify or protect you for the full sum, with the utmost good faith, provided you have declared a sum adequate for the purpose of the insurance contract. They will not pay an amount in excess of what the goods are worth as this would mean you have profited from a loss which is inequitable (unfair) and immoral.

NOTE - It is not a matter of setting your own guide-lines. The basis and conditions of cover are clearly spelt out so you have the opportunity to clarify so you do not contravene, breach or miss-understand the conditions of the contract. In other words the insurer works according to the conditions of the policy so you need to know them and not assume them !

The insurers have built in simple protective conditions to make the basis of cover fair to all:-

1] Replacement - meaning new for old The Protective condition is known as "Under insurance" or Average Clauses" and this applies generally if you have insured for less than 90% of the correct value. This means if you under- insure the insurer can proportionately under pay a claim.

Example: Building worth $100,000 and you only insure for $50,000 and have a $10,000 claim. The insurer can invoke the under-insurance clause - as you have only insured for 50% they only have to pay 50% of a claim. Note if a total loss the under insurance clause does not apply.

2] Indemnity or current market value.

The insurer can either pay you the sum insured or replace the vehicle with one of same age, model etc., whichever is the cheaper option for the insurer so under insuring the vehicle or item can be very costly.

IF OVER INSURED: The insurer can simply offer you the correct value (other than agreed value policies) or give you a similar item which is no better, no worse or New item less wear and tear costs.

The guide does not make allowance for the GST structure of an insured.

LIABILITY

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THE CONCEPT OF LIABILITIES AND RIGHTS

In Tort (French for wrong) law, rights and liabilities are as equal, opposite and inseparable, as the two faces of a coin. For one person to become liable, and equal and corresponding right must accrue to another.

For a cause of action to arise in tort (wrong) a person to whom a duty was owed must have suffered a loss, injury or damage as a result of the said action.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Negligence: "The omission to do something which a reasonable person under reasonable circumstances would have reasonably been expected to do". "Simply neglect of some care which we are bound to exercise towards somebody" Contributory Negligence: Where a person contributes to their own loss &/or injury they can not complain so harshly as to receive full compensation.

Absolute Liability: Where there is an inherent degree of danger which a reasonable person would either refrain or take full responsibility. Such a person assumes absolute Liability and is therefore responsible for any damage. This is also applicable to certain situations by law such as Workers Compensation.

Direct Liability: When a person who commits the wrongful act is personally answerable. This would not be the case as an employee, servant, and in some cases a contractor, unless is was a personal act and not related to their employment.

Vicarious Liability: "Qui facit per aluim facit per Se" meaning that one who does a thing through another does it oneself.

This means that a principal may always be held responsible for wrongful acts of sub-contractors as they have a duty of control over those who act on their behalf.

Please also refer to the earlier section on "Duty of Care" as this covers issues relating to Liability claims.

BAILMENT

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Your duty of CARE AS BAILEE

This is a very important "LIABILITY" issue when you have another’s property entrusted into your care.

Definition: “Bailment” = The delivery of goods from one person to another on the condition that they are restored to the former person (or handled as directed) as soon as the purpose of bailment has been fulfilled.

This can be as simple as leaving your car with the garage people for servicing or the TV with the TV person for repairs etc., It can be anything in your possession that is not yours. At all times as the bailee you have a "duty of care".

The person owning the goods is the "bailor" and the receiver is the "bailee". Transfer of possession from you to them must exist before bailment has taken place. It should be borne in mind that at law possession includes not only physical control of the item but also legal claim against any equity or the interest against others.

Redelivery of Goods is an important aspect of bailment. Whether in the same or in an altered form, bailment in law, has not occurred unless redelivered.

Two classifications of Bailment:Gratuitous situations Meaning without reward.

(Example: Personal use or Free services)

Reward Situations Meaning for where the bailee is being rewarded or paid for their services.

Important differences is that where it is "Gratuitous" recovery can only be achieved if there is Gross Negligence whereas when there is "Reward" for the bailee the courts require that a higher level of care be practiced.

LEGAL ENTITIES RECOGNISED FOR INSURANCE PURPOSES It is imperative to accurately recognise the correct "Legal" entity behind the insured name. Failure to do so may result in denial of cover or a reduction of entitlements under the policy.

Examples of entities:1] INDIVIDUAL OR PARTNERSHIPS The trading name has no legal standing or recognition by the courts for the purpose of responsibility therefore the full name of the individual or partners is essential.

CONFIRM:-> (Individual or Partners names) Trading as ....

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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2] INCORPORATED BODY ie., "Pty Ltd" or "Ltd" or "Inc" An incorporated body is seen as “a living person or physical entity” in the eyes of the court. They are capable of taking legal action against others as well as receiving such actions.

The shareholders enjoy the profit BUT do not have to personally bear or contribute to losses or actions unless they were personally involved, with intent.

NOTE: There are specific Company Laws which govern the code of conduct of companies and it's Directors. These laws are far more demanding than consumer laws so much care should be taken.

CONFIRM:-> (Incorporated name) T/as ....

3] SOCIAL CLUBS a] If the club is "Incorporated" it comes under No 2] above. It is independently accountable at law. The members therefore have protection under the incorporation just like the shareholders. b] "Non - Incorporated". This is very dangerous exposure to the members. It would come under similar interpretation as No 1] above. The club is not recognised by the court and actions can be brought jointly and severally against the members regardless of their involvement.

4] FAMILY OR UNIT TRUST This is a special entity created primarily for Taxation matters. The trust, as it implies, is a holder and is not capable of action without a Trustee. The trustee may be an individual or a Company as desired by the parties involved. The trustee is the responsible party, capable of suing or being sued and must be identified on all paperwork. The Trustee is, for our purposes the insured so clarification is essential for such risks as Workers Compensation.

CONFIRM:-> (Trustee name) A.T.F (name of Trust) T/as ....

CLAIMS INFORMATION THE DOCTRINE OF PROXIMATE CAUSE (Latin = Causa Proxima) In considering the losses and contingencies which are covered by a policy of insurance where there has been a sequence of events, the doctrine of "proximate cause" is of importance. "Proximate cause" has been defined as the active cause which sets in motion a train of events which brings about a natural result, traceable in a direct line to the first cause, without the intervention of any external force, beginning and operating from an independent source.

The legal maxim CAUSA PROXIMA NON REMOTA SPECTATUR, which means "THE IMMEDIATE OR PROXIMATE, NOT THE REMOTE, CAUSE MUST BE REGARDED".

CLAIMS - PHILOSOPHY The underlying philosophy behind this rationale is one of morale and integrity. The insurer has provided you with cover in good faith that you have insured on the correct basis.

Remember insurance is there to help but not to profit ! ....when a client incurs a loss and are unsure whether they should repair or replace ask them "what action they would take if they were not insured" ? ...in most cases people would take the most economical option and this is what the insurer would also do and will challenge you if you do otherwise.

Replacement or Market value ?

As mentioned at the front of this document there are two (2) types of policy types: "Replacement" (new for old) and “Market Value” (Indemnity) Please remember to recite the "Duty of Care" Philosophy" from the front publication as it has significance throughout all matters of insurance including the processing of claims.

OTHER - CLAIMS INFORMATION:The following information is contained within our website based …Client Insurance Manual 1.

2.

3.

A "Client Memo" which contains critical claims procedure to follow.

A "Helpful Hints" sheet on action to take when dealing with different claim situations.

"Workers Compensation" claims.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

Copy of this library is on our website

Client Insurance Product Library As at 10/09/2007 PRODUCTS A] Asset policies

Links

All risks – see Multi Risks Accidental Damage Accounts Receivable - see Credit Cover Aviation and Hull – Domestic/Private Bloodstock Bonds Boats - See Marine Hull Boat Builders Boiler and Pressure vessel Builders Warranty – see Home warranty Builders Indemnity Burglary Business Pak Business Interruption – see Consequential Loss of Profit Commercial Special Risks Caravan Cancellation – Abandonment & non appearance Capital Benefits – see Disability Cargo - See Marine Cargo Computer/Electronic Equipment Consequential Loss of Profit Contaminated Products Construction – see Contract Works Corporate Travel CPM (Contractors Plant & Machinery) Credit cover Crop Crime Death and Disgrace Defamation – see Liability section Debtors Disability Downtime Events - See Special Contingency Expatriate Insurance Electronic Equipment – see Computer / Elec Equipment Engineering (Machinery Breakdown) Farmpack Fire only Fire and Extraneous Perils Fidelity Fusion General Property Home and Contents Standard Home and Contents - Luxury Home Indemnity/Warranty Innocent Mortgagee Protection Inbound Medical Expenses Income Protection I.S.R. (Industrial Special Risks) Journey cover Judgment Indemnity Keyman (Succession Planning) Kidnap and Ransom – See Political Risk.

Landlords - Commercial Landlords – Domestic Legalexpenses - Commercial Livestock Libel and Slander Life and TPD (total Permanent Disablement) Loan cover Loss of Profit – see Consequential Loss Machinery Breakdown – see engineering Marine Hull - Pleasure Marine Hull - Commercial

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1. Main Menu 2. All Products 3. Other Insurance info Marine Cargo Marine Builders Risk – See Boat Builders Material Loss &/or Damage Marine Transit – see Marine cargo Money Mortgagee Insurance Mortgagee Protection Motor Cycle Motor Vehicle – Standard <1 tonne Motor Vehicle - Prestige/Luxury Motor Vehicle – Commercial/Cartage Motor Vehicle – Commercial Trailer Motor Vehicle - Fleet Mortgagee Protection Multirisk Patent Protection Plant Hired in Personal Accident and Illness Pluvious (rain) Political Risk Office bearers – see Liability office bearer Office Pak Salary Continuance Plan Spoilage Strata title property Strata Mortgagee Interest Protection Special Contingency Sports Pak Sudden Accident Pollution – see Environmental Impairment Superannuation Tax Audit Theft Trade Debtors – see Debtors TradesPak Travel Pak Truck – see MV Commercial Voluntary Group PA/Disability

B] Liability policies Association Liability Carriers Liability Contractual Liability Defamation Directors & Officers Liability Employer – See Workers Compensation Environmental Impairment EPL - Employment Practices HELP (Host Employer Liability Policy) IT Information Technology & Telecommunication Malpractice Management/Corporate NFP – Not for Profit (groups) Office Bearers Primary Excess Layer Professional Indemnity Public Liability Road Risk Ship repairer Statutory Liability (Fines) Superannuation Trustee's Liability Third party (see Road Risk Liability) Umbrella Liability Workers Compensation – standard cove Workers Compensation – Industrial Diseases

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Links 1. Main Menu 2. All Products 3. Other Insurance info Product

Accidental Damage Additional cover to a standard defined events policy.

Why consider such a product?

To cover damage from the unusual and un expected events.

Purpose

Policy Divisions Settlement

Most policies are “defined events”, meaning the “trigger” (cause of the loss) must be defined (listed) otherwise its not covered. The obvious losses covered in this policy are the peculiar “Accidents” such as:Stains on Carpets, pictures falling of the wall, or items fallen of the desk or table. It even includes internal transit ie., when you move things within your property and an accident occurs resulting in damage to the goods (this type of loss is often not covered in a defined event policy).

This type of cover is not purchased independently. It is usually an option or extra benefit in a “package policy” such as a Business Pak or a Home Contents.

Asset only Asset and/or Liability Liability only Yes Replacement New for Old Depends on the policy

No

No Indemnity (market Value) Depends on the policy

Level of cover

“Gold” – (broadest cover) Yes

Rating factors

Occupation/Use, Location, Items to be insured, Limit required, Claims History.

Premium

“Silver” (defined events)

“Bronze” (restricted)

To add as an extra benefit the costs are approx:Business Pak = sum insured of $10,000 = approx $100 min premium $100 Home Contents = around 25% increase on standard rates

Excess Situation

General

Business Pak $200

Home/contents $100

Static / fixed location only

Mobile

Depends on policy type

Depends on policy type

Best Practices: 9 Purchase cover within a Package policy – lower rate – see “Business Pak” 9 Under a Transit policy goods are only covered in transit to or from a location and/or during act of loading and unloading BUT NOT within your premises. This policy will cover that gap.

9 Some BPK exclude “Accidental Damage” on stock items or Fragile items.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Links 1. Main Menu 2. All Products 3. Other Insurance info Product Purpose Policy Divisions Settlement Level of cover

Aviation and Hull – Domestic/Private To cover aircraft and it’s Liability.

Fundamental aspects of this policy are the same as a Boat (Marine) – Hull and LIABILITY policy Asset only Asset and/or Liability Liability only Yes Yes No Replacement New for Old Indemnity (market Value) Generally no

Either

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

Yes

Generally No

Generally No

Rating factors

Same as Hull Insurance. Year Make Model, Location radius of use Sum Insured

Premium

Rates are generally $150 + 3% of sum insured diminishing after $50,000 Minimum premium $750

Excess Situation

Static / fixed location only

Mobile

No

Yes

This type of cover is a specialized field and therefore requires personal discussion.

You can also acquire additional cover for General

• •

"Consequential Loss of Profits" Third Party (property & bodily injury) Liability also available. This would need to be considered for a] The Passengers and b] Third Parties other than passengers

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Links 1. Main Menu 2. All Products 3. Other Insurance info Product

Purpose Policy Divisions Settlement Level of cover

Bloodstock To cover Horses used in the Racing and/or Pacing industry.

Cover is Mortality (Resulting in Death) only.

Transit is usually included at no charge.

Some insurers will offer Theft as an option.

Asset only Asset and/or Liability Liability only Yes Yes No Replacement (New for Old) Indemnity (market value only) No

Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

No

Yes

Rating factors

Situation, Age, Sex, Sum Insured, Claims History.

Premium

Minimum $300. Rates approx $150 + $4.00 per $1,000 – diminishing with higher values.

Cover is subject to Vet's certificate + valuation.

Renewal is also subject to vet's certificate. Liability at around $40 per horse.

Excess

$500

Situation General

Trivia

Static / fixed location only

Mobile

No

Yes

There is another policy known as "Livestock" or “Farmpak" used for other animals, the cover is similar but generally it is restricted to defined event of “Fire” only.

Mare = female >4 years old Filly = female <4 years old.

Stallion is also known as a "Horse" or "entire".

Gelding is a male of any age but not "entire".

Colt is a male <4 years old.

"Thorobred" = a horse bred for racing or galloping.

"Standardbred" = a horse bred for pacing.

All horses have a common birth date:In the Southern Hemisphere it is 01/08/19....

In the Northern Hemisphere it is 01/02/19....

"Hands" is a measurement equal to 4 inches.

Tips

Horses do not race until the age of 2.

Sum Insured on these animals change rapidly depending on their on field success.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Links 1. Main Menu 2. All Products 3. Other Insurance info Product

Bonds and Guarantees A guaranteed outcome based on a performance.

The insurer will pay-out to the value of the Bond or guarantee should a 3rd party suffer a loss or be entitled to some reward as a result of terms of the bond or guarantee.

Purpose

Policy Divisions

Reward to a 3rd party could be “hole in one” or “guessing measurements” competitions. It is usually arranged under a "Special Contingency" (see listing).

Guarantee (breach of performance) Loss suffered by 3rd parties would be a result of non performance.

This usually means the insurer acts as a “guarantor” for the insured to provide prompt payment to the rd 3 party and then recover from the insured.

Asset only Asset and/or Liability Liability only Yes Replacement New for Old Indemnity (market Value)

Settlement Level of cover Rating factors

Yes “Gold” – (broadest cover)

“Silver” (defined events)

Generally No

Yes

“Bronze” (restricted)

Occupation, Experience and Qualifications, Limit required.

Minimum $1,000 Rates naturally vary quite a bit. Broad rate is $150 + 7% of the Sum Insured on a diminishing scale

Premium Example Excess Situation

Sum Insured $30,000 rate 5% Sum Insured $100,000 rate 3%

Sum Insured $50,000 rate 4%

1% of Sum Insured with minimum $250 Static / fixed location only

Mobile

Depends on risk

Depends on risk

Also try Bonds, Contractual Liability, Special Contingency and Warranty – they all relate to Performance.

General

There are quite a few different type of “Bonds”, we have an extended list of the descriptions in our “Central” product brochure on Bonds, please ask.

Related topics Pluvious (rain) – cancellation due to rain Public Liability for the event

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Boat Builders To cover Boats during construction. It can also include sea trials and delivery if required.

Section [1] covers material damage of works, that is, the cost value of the vessel during construction, testing etc., Section [2] Liability or otherwise known as P&I (Protection and Indemnity) in the marine industry.

Asset only Asset and/or Liability Liability only Yes Yes No Replacement New for Old Indemnity (market Value)

Settlement Level of cover Rating factors

Premium

Yes “Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

Yes Occupation/Use, Estimated No of Vessels to be built PA, Average value of vessel, Period to build each vessel, Location, Experience and qualifications, If standard designs used and by who, Is cover required for Trials/Transit &/or Delivery, Claims history.

Minimum $2,000 Rates can vary depending on values and product built.

Example of rate structure:- $150 + .50c on estimated turnover. Usually has a minimum non refundable deposit premium.

The insured must declare each month all works commenced. The premium can be charged each month or pay an annual deposit premium and adjust each year after completing a declaration.

Excess Situation

Usually $250 Static / fixed location only

Mobile

Depends on risk

Depends on risk

Best Practices: 9 9

Products Liability (once it leaves your possession) – is it required?

Sea trials and Delivery?

KEY ISSUE: If you are a Builder and have taken an annual policy you will also need to take out a separate General Liability policy as the above Liability is only in respect to the actual works and not your office or workshop other than the actual item being worked on or elsewhere.

General

Optional cover Sea Trials, Transit &/or Delivery.

Trials: most insurers will include cover for Sea Trials.

Transit: most insurers will include cover within say 25kms, provided it is incidental to trials. NOTE: Once the trials are finished the vessel has been tested and cover ceases so you must be ready to arrange cover under a boat policy. (This is the same principle as home construction policy).

Trivia

Delivery: most insurers cover this as an option BUT NOT if delivered under its’ own power. The extra cost is around .50% of the sum insured.

If the insured only does repairs or a Tradesman associated with boats they may only need a "Liability Shiprepairers" policy.

Remember Liability is for loss/damage suffered by a 3rd party so as long as the item being worked on is not the insured's property it will be a Liability issue. If on the other hand the item being worked on is the insured's property they will need to cover such item under section [1]

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Boiler and Pressure Vessel To cover specific Plant resulting from explosion or collapse.

Purpose

Rating factors

Options/Extensions to cover Flue Gas explosion, Cracking and Overheating.

Policy Divisions Settlement

Level of cover

Asset and/or Liability

“Silver” (defined events)

Generally New for Old

Claims history, Occupation/Use, Location, Items to be insured.

Minimum $400 Average Small General Manufacturing plant = approx $500

Premium

General

Excess

Situation

Usually $250

Static / fixed location only

Best Practices: 9 Purchase cover within a Package policy – lower rate – see “Engineering" policy 9 Many clients do not take this cover, they consider o Premium against frequency of claims, high excess and deprecation limits on age of machines and own controls to minimize loss.

You can include damage to your surrounding property as this may not be covered under your existing business Pak policy – it may not include defined events such as “Collapse.”

Trivia Most standard Liability policy include 3rd party damage from boiler/pressure vessel provided they do not require certification (certification relates to vessel of higher than normal pressure)

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Builders Indemnity To cover the completion of the work in the event the Builder is Financial insolvent.

Purpose

Housing laws require registered builders to provide “Financial performance Guarantee” in the event they face financial collapse. This policy ensures the home buyer is not stuck with a partially completed house and funds have been consumed by the builder.

Policy Divisions Settlement Level of cover Asset only

Rating factors

Indemnity (market Value)

“Silver” (defined events)

Occupation, Financial balance sheet of the builder. It required, Claims History Not known. Builders usually access a facility through their association scheme

Premium

Excess

Situation

Not known

Static / fixed location only

General Tips

Best Practices: 9 No volume of dealings in this topic, can not list best practices.

Trivia

There are few insurers that handle this type of risk. The main providers of this topic are related to the Building trade ie., the Builders assoc., and the like. There are a few Insurance Brokers that specialize in this product such as: “Saville Hicks”

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Burglary Loss resulting from Violent and/or Forcible means from a Building (not just the situation) of the insured.

Some policies include an authorized custodian (some else at another location).

Purpose

Rating factors

Premium

Burglary also includes o Felonious concealment on the premises (hide in the premises until closed and then break out) o Threat with violence or Force Policy Divisions Settlement Level of cover Asset only Indemnity (market Value) “Silver” (defined events) Occupation, Location, Items to be insured, Limit required, Claims History and Security will have a critical effect not just on rate but actual acceptance in some cases.

Business risks minimum around $150 Rates vary from 2% to 10% depending on the items insured. For Example:All rates start at $100 + a rate on the sum insure of:Tobacco/Alcohol items = 11% Stock Clothing items = Computer/Electric items = 06% General Stock items = Plant hand tools = 06% General Plant & Contents =

09% 03% 02%

Some rates can be discounted by up to 50% if a Monitored Alarm is installed.

Excess Situation Generally $150.

General Tips

Trivia

Static / fixed location only

Best Practices: 9 Rates 10 times higher than Fire & Perils cover. You do not have to insure for full value (No under insurance clause) so consider the exposure on a "Hit and run" or "Smash and Grab" basis to keep the premium down.

9 Lower rates under a Package policy – see “Business Pak” 9 Theft (shop-lifting) is not included. Some insurers can consider however the premium is quite high.

Some insurers call "Burglary" cover "Theft" with a precondition of violent and/or Forcible which it is the same as "Burglary".

9 Burglary is from violent/forcible entry to Building not just the property ie., items left outside are not covered. – If you have items outside or attached to the outside of the building review this with the insurer.

9 You may need to include a sub-limit for damage to premises by intending Burglars as it may not be covered under “Malicious” damage section of Fire and Perils policy.

9 If you request a high sum insured many insurers will become reluctant to provide any cover whatsoever.

Whilst any reduction in rate will not be sufficient incentive to install an alarm or further security you need to consider the commercial reality of:Intangible losses such as the inconvenience and disruption to your business.

If claims are repeated your premium and/or excess will be increased.

Prevention is better than cure.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Business Pack (Package policy)

Purpose

A single policy covering a variety of popular / common risks for the Small Medium Business.

The sections listed are listed independently in this library.

General

Insurers have created several “Package” policies:• Office Pack – specially designed for “offices” • Farmpak – specially designed for most Farming activities • Trades Pak” – specially designed for most tradespeople Package policies are always lower in pricing. The insurer is able to reduce their administration costs by issuing 1 policy schedule which can include many sections.

Typical sections available for Business/Office/Tradesmen Pack policy are:-

Tips

FIRE & PERILS

ACCIDENTAL DAMAGE

CONSEQUENTL LOSS

BURGLARY

MONEY

FIXED GLASS

PUBLIC LIABILITY

FIDELITY

MOTORS/ELECTRONIC

SPOILAGE

GENERAL PROPERTY

COMRCL LEGAL EXPN

DISABILITY

MOTOR VEHICLE/S

TRANSIT

TRADE DEBTORS

To see the typical sections of a farmpak see the separate listing Best Practices 9 To fastrack the decision making on multiple sections we recommend accessing 1 of several separate documents, listed hereunder:9 Brochure titled “SME” (Small Medium Enterprise) Lists popular Business Pak sections, including brief description and costs.

9 Brochure titled SME Business Pak – Crisis Checklist. 1 page summary of most common sections, by Industry with cost and Priority.

9 Brochure “ORI” 1 page summary of critical covers according to your Industry.

If Asset Value exceeds $2,mil consider using an I.S.R. policy for broader cover Note – Workers Compensation is always controlled under a separate audited policy for Government compliance regulations.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Purpose

Rating factors

Cancellation – Abandonment & Non appearance To cover loss arising from Cancellation, abandonment and/or non appearance of key performers.

Typically designed for Hospitality/entertainment events Policy Divisions

Settlement

Level of cover

Asset only

Indemnity (market Value)

“Silver” (defined events)

Occupation, Location, Period of Indemnity (period of pay-out ie., 3/6/12/18 mths).

Rates would be similar to those used for "Bonds and Guarantee" cover (see listing).

Premium

General

Excess

Situation

$500

Static / fixed location only

You would also need to consider • Cover for your equipment • "Pluvious" in case rain stops the show.

• Liability (property & bodily injury) to other parties such as Employees or the Public.

It is relevant to declare • if you are providing food and drinks, if you have goods in your custody, if scaffolding is used etc.,

Trivia

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Caravan To cover the material damage of your Caravan and Liability to others caused by it’s physical contact

Purpose

Policy Divisions Settlement Level of cover

There are two types of classification:1. Mobile Caravan. Cover is the same as "Motor Vehicle" 2. Home Caravan (permanently sited). Cover is the same as a "Home and Contents" Liability - In both instances 3rd Party Liability is also available and usually automatically included.

Asset only Asset and/or Liability Liability only Yes Replacement New for Old Depends on the policy

Yes

No Indemnity (market Value) Depends on the policy

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

Depends on the policy

Depends on the policy

No

Rating factors

Mobile same as "Motor Vehicle"

Premium

All rates at $150 + sum insured:A] Mobile Caravans $10,000 = 3.0% $20,000 = 2.0% less up to 40% No Claims Bonus b] Home Caravans $10,000 = 1.5% $20,000 = 1.0%

Excess

Mobile same as "Motor Vehicle"

Situation

Permanent sited same as "Home and Contents"

Permanent sited same as "Home and Contents"

Static / fixed location only

Mobile

Depends on the policy

Depends on the policy

General

Best Practices: 9 Same as Motor vehicle or Home Pak as appropriate.

Trivia

Permanently sited caravans are not covered when moved ie., relocated (same as a house policy).

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Client Insurance Product Library As at 10/09/2007 CARRIERS LIABILITY

see "Liability - Carriers" (see listing)

CARTAGE TRAILER

see “Motor Vehicle Commercial Trailer" (see listing)

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Commercial Special Risks Same as "General Property" or "Special Contingency" (see listings).

Purpose

Policy Divisions Settlement Level of cover

This specific policy usually only provides Level of Cover = Gold whereas "General Property" or "Special Contingency" contracts have options for Level of Cover “Gold” or “Silver”.

Asset only Yes Replacement New for Old

Asset and/or Liability Liability only No No Indemnity (market Value)

Optional

Optional

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

Yes

Generally No

No

Rating factors

Item/s insured, Use, Location, claims experience

Premium

Min premium $250 – usually $150 + 4% of the Sum Insured.

The level of cover s usually Accidental Physical Loss or Damage which would include Burglary.

Excess

$250

Situation General

Static / fixed location only

Mobile

Depends on the policy

Depends on the policy

Best Practices: 9 Qualify Indemnity provision of policy – it will effect your decision on what value to insure.

9 Qualify Burglary limitation (some policies have the same title but different definition).

Trivia

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Computer / Electronic Equipment A dedicated policy to deal with specific exposures of this risk.

Purpose

Policy Divisions Settlement Level of cover Rating factors

Typically the policy affords the following options o Fire and Extraneous perils o Accidental Damage o Burglary violent or forcible entry o Re writing of records – as a result of loss under all other sections o Electronic breakdown – subject to repairers report o Transit - “All risks” excludes electronic derangement unless resulting from Physical damage. Option s are within Australia or overseas Asset only Asset and/or Liability Liability only Yes No No Replacement New for Old Indemnity (market Value) Generally Yes No “Gold” – (broadest cover) “Silver” (defined events) “Bronze” (restricted) Yes No No Occupation/Use, Location; Static or mobile cover, Security, claims history

Premium

Minimum $250 rate is $150 + 3.00% of Sum Insured and reduces as value increases.

Note: some insurers will not give "Breakdown" cover unless you have a current maintenance agreement. Mobile cover add 30%

Excess

Usually $100 with $300 on Transit

Situation

General

Trivia

Static / fixed location only

Mobile

Not applicable

Not applicable

Best Practices: 9 Lower rates if Purchased within a Package policy – see “Package Policy” or “Engineering” 9 If you already have a Business Pak policy most sections would already be covering the items whilst a work other than Transit and Breakdown.

9 Many clients do not take this cover, they consider premium and their exposure. o Premium against frequency of claims, high excess and deprecation limits on age of machines and own controls to minimize loss.

9 This is one of the few policies where you can actual reduce the “replacement value” each year 9 Transit cover is for personal items (laptops) which are carried with you, most insurers will not accept claims if these items are transported as "ordinary luggage", due to their sensitive nature - so carry them with you.

9 Transit cover usually limited to aus wide not world wide unless noted

CONSTRUCTION INSURANCE

CONSUMER CREDIT INSURANCE

See "Contract works" (see listing).

See "Loan Insurance" (see listing).

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Consequential Loss of Income To cover loss of Gross Profits as a consequence of a loss 1st triggered by the Fire and Perils policy (in some instances including Burglary section).

Purpose

The policy is generally only available for a “static” (fixed location activity) as it relies on the trigger of a “defined event” loss under the Fire & Perils section (or "Material Loss and/or Damage section).

If your business is dependant on mobile activities; Cartage, Tour Operator, Marine charter some other options are available such as downtime of your key transportation assets.

Policy Divisions Settlement Level of cover Asset only

Rating factors Premium

Trivia

“Silver” (defined events)

Occupation, Sum Insured (include or exclude expenses), Period of Indemnity, Claims history Minimum premium = $120 Rates usually around 75% of the Fire and Perils rates.

Excess Situation usually 24/36 hours.

General

Replacement New for Old

Static / fixed location only

Best Practices: 9 If activities reliant on Mobile plant consider downtime policy.

9 Insurers will expedite Fire and Perils claims to avoid pay-outs under this section!!

9 Lower rates when Purchased within a Package policy – see “Business Pak” 9 Rate is lower to allow of high sum insured (Full value) and exposed to Average/underinsurance so over insure to avoid high loss from nominal premium.

9 "Loss of Rent" is better placed under this section for the benefit of the insured. Reason = 9 1] Some "Loss of Profits policies activate after a Burglary so if there has been section of the building stolen this may allow a claim.

9 2] If the rent is insured under Fire the claim is satisfied once the building is reinstated whereas under this section the claim may continue until a tenant is found.

9 To keep the premium down to a budget consider nominated fixed admin costs that you do not wish to cover, these might include admin wages, telephone, postage cost.

9 If the premium is too high at least consider 9 ICOW “Increased cost of working”. The premium is generally only around $100 for $50,000 sum insured. This would go a long way to address immediate interruption costs to ensure some continuance of the business.

9 There are two types of declaration methods. The most common method is the "Difference Method":a. The general rule is to provide replacement of your Gross Profit. Gross Profit is Sales, less cost of sales, being stock or Manufacturing costs. b. The insured must nominate an indemnity period, that is, the number of months for which cover shall apply. It is imperative to take into account the time required and key factors to re-establish. c. Example:- Manufacturer (key factor may be time to replace equipment). Retailer (key factor may be time to re-fit or appropriate new site). Office (key factor may only be the time for new phones) Revenue/Sales Less costs of sales Stock purchases, freight and manufacturing process Gross Profit – Value to be Insured Less – items to be excluded Wages and other (to be detailed) Revised sum insured 9

$1,000,000 -$ 400,000 $ 600,000 $ 375,000 $ 225,000

We have dedicated brochure and practice worksheets available on request

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Contaminated Products The policy is designed to cover your (the insured’s own costs) associated with:¾ Accidental Contamination, ¾ Product Recall, ¾ Malicious Product Tampering and/or Extortion rd Owns costs also known as 1st Party, meaning it does not deal with 3 party costs which is a Liability risk.

Purpose

Policy Divisions Settlement Level of cover

What are the typical costs that arise:¾ Replacement cost of the product ¾ Product Recall costs ¾ Business Interruption ¾ Rehabilitation costs ¾ Consultants and Advisors Policy trigger: Human use consumption of the insured product/s has resulted in or would result in Property Damage or Bodily Injury within 360 days following such use or consumption.

Asset only Asset and/or Liability Liability only Yes Replacement New for Old

No

No

No Indemnity (market Value) Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

Yes

Yes

No

Rating factors

Industry of Manufacture, Product/s, Turnover, Location, claims history

Premium

Turnover $8,000,000 $8,000,000

Excess

$10,000 or 10% of Loss (whichever is the greater)

Situation General

Limit $250,000 $500,000

premium $6,000 $7,500

Minimum premium $4,000

Static / fixed location only

Mobile

No

Worldwide

Best Practices Manufacturers need to consider the risk.

Since 1986 The Australian Competition and Consumer Competition has lodged over 8,345 product recalls, spanning all Industries

Trivia

If you are dealing with National retailers their Risk Management conditions on Product Recall are very severe in terms of the cost of disposing of the product and replacement.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Links 1. Main Menu 2. All Products 3. Other Insurance info Product Purpose Policy Divisions Settlement Level of cover Rating factors Premium Excess Situation

General

Contract Works To cover “construction phase". Such works as: Domestic or Commercial Buildings, Sub divisions; Road and sewage works etc., Asset only Asset and/or Liability Liability only Yes Yes No Replacement New for Old Indemnity (market Value) Yes

No

“Gold” – (broadest cover) “Silver” (defined events) “Bronze” (restricted) Generally the standard cover No Unless agreed Occupation, Type of Construction, Location, Sum Insured, Period of cover, Claims history, If owner builder or Register Builder.

Section [1] Asset cover Minimum premium $350 - rate approx $3.50 per $1,000 of Asset value Section [2] Liability Minimum premium $300 – rate approx $2.00 per $1,000 of Asset value If an annual policy with continuous works the rates would be approx 75% of the above.

Usually around $500 for Domestic risks and Commercial $1,000 Worker to Worker (Injury caused by sub contractor to another can be $1,000 to $5,000) Static / fixed location only Mobile Yes No You can effect “single period” or “Annual” period policy for continuous works with monthly declarations and quarterly payments in advance (suitable for Builders).

Best Practices: 9 Most policies are offered on 12 month period so start cover now, in case people are the site before works actually begin.

9 Asset value rate is low to allow for high sum insured (Full value) and exposed to Average/underinsurance so over insure to avoid loss from a nominal premium.

9 Consider the value of any existing buildings as well as additional costs, such as:o Removal of Debris, Expediting costs, Professional Costs, Cost Escalations, Existing buildings, Plant and Equipment etc., and further as per the proposal.

9 ICOW= Increased Costs of Working. Consider this “Cons Loss” if something happens to the site or other premises. This is critical:o on Remote locations ie., Living costs or o delay in replacement of Materials 9 Public Liability (to property and bodily injury) also available. There are a variety of extensions that need to be considered such as "Worker to Worker", Unreg Vehicles etc., 9 Workers Compensation liability exists whether you are a regular builder or owner builder, the rate will change accordingly.

Cover: "Material Loss and/or Damage", this also includes Burglary and Theft from the site Most insurers will not consider the risk if the works have already commenced.

Why… Their concern is that there may already be damage. If you are renovating you need to make provision for existing buildings as it MAY NOT be protected by a standard home policy.

Trivia

If you are an Owner Builder the Liability section of this policy will not respond if you damage your existing property! (Liability is to 3rd parties).

If you are a Builder and with an annual policy you may also need to take out a separate General Liability policy as the Construction Liability is the actual works and not your office or elsewhere.

9 Some insurers will auto include such cover as part of an annual declaration policy.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Corporate Travel To cover Business Travel:Intrastate (within the state – usually beyond 500kms) Interstate (across boarders) Overseas

Purpose

Policy Divisions Settlement Level of cover Rating factors Premium Excess Situation

General

Trivia

Similar policy to single “one off” travel policy however this annual renewable policy means you do not have to remember to insure each time you or your employees travel. An annual policy not only provides “peace of mind”, but saving in admin and premium costs.

The policy affords a variety of sections and limits to suit each business.

Asset only Asset and/or Liability Liability only Yes Yes No Replacement New for Old Indemnity (market Value) Both depending on sub-sections

Both depending on sub-sections

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

Generally

No

Unless agreed

Occupation/Use; People covered; Employees or Volunteer staff, No of Journeys and if Journeys are overseas, Interstate or intrastate (within the state), claims history.

Minimum $500 and variable depending rating factors. Premium is charged on a deposit basis on an estimate of voyages and adjusted on renewal by declaration.

Various depending on sections. The excess is similar to a domestic travel policy as are the sections of cover.

Static / fixed location only Mobile No

Yes

Best Practices: 9 This policy saves admin on multiple polices for each travel.

9 Package policy generally saves around 30% in annual costs, let alone saving in admin time.

9 Pre existing illness/injuries not covered unless otherwise ratified.

9 This policy does not dismiss obligation of any statutory cover ie., Workers Comp 9 If you have any workers traveling overseas Worker Comp has limitation – this policy can buy the gap in “Common Law” cover Sample of Schedule of Benefits:9 DEATH & CAPITAL, WEEKLY ACCIDENT, WEEKLY ILLNESS,LIFE INSURANCE (ILLNESS) 9 OVERSEAS MEDICAL & ADDITIONAL BENEFITS 9 ALL MEDICAL COSTS OUTSIDE AUSTRALIA EXCEEDING 9 POLITICAL RISK (EVACUATION COSTS) 9 ALTERNATIVE EMPLOYEE EXPENSES 9 COLLISION DAMAGE AND THEFT WAIVER EXCESS - EXCESS ON RENTED VEHICLES UNDER RENTAL AGREEMENT 9 LOSS OF DEPOSIT (AGAINST UNFORESEEN CIRCUMSTANCES) 9 BAGGAGE, TRAVELLERS CHEQUES, TRAVEL DOCUMENTS 9 PORTABLE/ELECTRONIC EQUIPMENT 9 MONEY - CASH & NEGOTIABLE INSTRUMENTS 9 KIDNAP & RANSOM (DEMANDS FEES & BORROWING COSTS) 9 PERSONAL LIABILITY - BODILY INJURY & DEATH OR 9 EXTRA TERRITORIAL WORKERS COMPENSATION Must use Emergency service facilities provided.

Does not cover private/charter aircraft or hazardous activities without prior agreement Does not cover prior medical conditions without prior agreement Does not cover private travel without prior agreement Policy is subject to notice of change if territorial zones become unsafe.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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CPM – Contractors Plant and Machinery To cover nominated Heavy Plant and Equipment.

Purpose

Policy Divisions Settlement Level of cover Rating factors

The cover is similar to Conventional Motor Vehicle Insurance: Physical Accidental Loss &/or Damage to the unit including Liability (if registered) caused by its physical impact.

Asset only Yes Replacement New for Old

Asset and/or Liability Liability only Yes No Indemnity (market Value)

Not usually, some options available

Generally Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

Yes

Generally No

Generally No

Occupation/Use; Location, Year Make Model of Plant, Sum Insured, Claims history \ Minimum $250. The rates reduce as the sum insured increases.

Premium Excess Situation

General

Trivia

1% of sum insured up to $100,000 up to $150,000 .75% If registered (for road use) another $300 may be charged for Road Risk Liability Generally 1% of the sum insured with a minimum of $500 Static / fixed location only

Mobile

No

Yes

The risk is rated on an owner operator basis. If the unit is to be hired out the insurer must be informed.

Best Practices 9 Check what type of policy is being used:o Some Insurers issue a “CPM” policy which has not Liability section. Some Insurers use a Commercial Motor Vehicle policy which includes Liability for Road Risk and/or Tool of Trade use.

9 When used as a “tool” not road vehicle the Liability is under a separate General Liability policy not related to the Vehicle registration liability.

9 If the unit is unregistered the Liability exposure is afforded under a separate Public Liability policy.

Some insurers have specialized policies for this type of risk. The special policy can offer a variety of special options to suit your budget.

EXPEDITING COSTS (Reasonable additional costs) MULTILIFTS (Loads shared by 2 or more lifting machines) HOOK RISK (Items on the actual Crane Hook - with Average) INCREASED COSTS OF WORKING (To Minimise Interruption) LOSS OF REVENUE (14 day/$2,500 Excess - 3 Mths Indemnity) MACHINERY BREAKDOWN (Sudden & Unforeseen physical loss) HOLD HARMLESS (Indemnify all Direct first Hirers) APPRECIATION (Up to 25% above value stated) AGREED VALUE (Sum Insured is agreed for period of cover) RECOVERY COSTS (On immobilised Items Excess $500) ACCIDENTAL OVERLOAD (Must demonstrate not Deliberate) LEASE VALUE PROTECTION (Shortfall if a total loss) LEASE PAYMENT PROTECTION (Exs 10% Max cover 12 payments) DRY HIRE (When items Hired out without an operator) OWNERS PROTECTION Loss caused by employee which may prejudice insured's claim.

Most extensions are around 15% loading, as a guide only !

We have a special explanation guide on this topic available on request.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Credit This may be miss-interpreted!

Purpose

If cover is for your Creditor (someone you owe money to) ie., to cover loan repayments in the event of Disability and/or Unemployment refer to "Loan Insurance".

If cover is for a Debtor (someone owing money to you) refer to "Debtor Insurance".

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Crop To cover "Loss of Yield" following loss &/or Damage to specified Crop/s.

“Defined event” usually restricted to "Fire and Hail" only

Purpose

Policy Divisions Settlement Level of cover

Note: This restricted cover does not include the usual extraneous perils which are normally attached to a “Fire and Perils” policy. Some insurers also include a "Re-planting" subsidy if loss sustained before crop established.

Asset only Yes Replacement New for Old

Asset and/or Liability Liability only No No Indemnity (market Value)

No

Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Rating factors

No. of hectares x yield (2 tonne per hectare) x $____? per tonne. The usually rate is 1.00% of sum insured.

Premium

Min premium $500 standard alone with rate of around .15c on sum insured.

Excess

$100 to $250

Situation

General

Trivia

Static / fixed location only

Mobile

Not applicable

Not applicable

Best Practices: 9 Purchase cover within a Package policy – lower rate – see “Farmpack” 9 Rate is lower to allow of high sum insured (Full value) and exposed to Average/underinsurance so over insure to avoid high loss from nominal premium.

Fire only cover is generally only applied to farming/Agricultural risks where they are out in the open or in remote areas example: 9 Crops, Farm fencing, Hay bails stored for feed, General Livestock

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Crime Fraud / miss appropriation of company assets (money or securities) by employees.

Traditionally known as “Fidelity” however more dynamic policy is offered by some insurers as outlined below:-

Purpose

Policy Divisions Settlement Level of cover

Sample of cover 9 Employee theft – loss of money/securities caused by theft/forgery of employees 9 Premises cover – loss sustained by destruction/disappearance/abstraction of subject matter 9 Transit cover – same as premises cover but for outside premises to a 3rd party. rd 9 Depositors Forgery cover - where drawn upon the company’s accounts by a 3 party 9 Computer Theft and Funds Transfer Fraud cover – intentional use of computers or instructions to a financial institution to transfer pay or deliver monies / securities.

9 Investigative costs cover – reasonable costs to establish the existence and amount of loss.

Asset only Asset and/or Liability Liability only Yes Replacement New for Old

Yes

No

No Indemnity (market Value) Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Rating factors

Industry, turnover, years established, number of

Premium

Min premium $1500 standard alone but lower under “Farmpack”

Excess

$500

Situation

General

Static / fixed location only

Mobile

Not applicable

Not applicable

Best Practices: 9 Similar as “PI best practices” 9 Limited/restricted form of cover under “Fidelity” 9 Lower price if purchased under a packaged policy –see “Management Liability” Issues to consider Prosecution clauses – often this is a precondition to cover.

Superannuation fund cover.

Unidentified or temporary/hire in staff may be excluded

Trivia Our experience that very few business consider this product when considering:1. The required to prosecute 2. the premium 3. their existing risk management controls

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Death and Disgrace [1] To compensate the insured for financial loss resulting from the Death or Disgrace of a named person.

Example:-

Purpose

"DEATH" = Where an advertisement has to be taken off due to death of the person in the promotion.

This would mean a financial loss to the insured ie., the company relying on the benefits of the promotion campaign.

"DISGRACE" = The person/s in the add are found to have committed and/or caused some event which will lead to public disgrace or embarrassment which would be grounds to terminate the promotional campaign to save face the company running the Commercial.

Policy Divisions Settlement Level of cover

Rating factors

Asset value only Indemnity (market Value) “Silver” (defined events) according to the occupation/advertised product, Intended area of exposure, Persons appearing in add and amount of protection required.

Minimum of $1,000. No broad rates

Premium

General

Excess

Situation

$500

Not applicable

No volume of dealings in this topic to list “best practices”

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Debtors To protect you against insolvency of your client (debtor) (also known as protracted default).

Purpose

“Up to 90% cover for insolvency of trade debtors.”

Trigger for claim “Cover is available for ‘Protracted Default’ which is deemed to occur when every endeavour to recover the debt and/or render the buyer formally insolvent has been made but without success, for reasons beyond the insured’s control (satisfactory evidence of debt, however, is required).”

Policy Divisions Settlement Level of cover Asset only

Rating factors Premium Excess Situation

General

Trivia

Indemnity (market Value)

“Silver” (defined events)

Occupation, T/Over, Limit required, (Proposal required as many special questions required).

Minimum Premium is around $6,000 with $1,000 excess and based on say:Cover against up to 10 named debtors for say $60,000 in debt value with 80% indemnity (protection).

Otherwise rate is 5% up to $2mil The excess period is usually around 06 months and conditional to you exhausting all usual means of recovery.

Static / fixed location only Mobile Not applicable

Not applicable

Best Practices: 9 Purchase cover within a Package policy – lower rate – see “Business Pak” 9 Very few clients consider such a policy due to budget constraints or own controls in place. It is likely to be valuable only to Corporate or Exotic based activity clients, or those that have experienced the need to have such cover.

9 Pre condition to a claim trigger is prosecution / legal action.

9 Premium is rated on annual turnover (not single contract). If single contract cover is required the insurer will either decline because you have specific concern of the risk or the insurer will load premium for a single contract.

9 Standard pre condition that you must disclose circumstances that may give rise to a claim ie., if you are aware the debtor may be an exposure the insurer must be told before going on cover otherwise they can reject a claim through discovery.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Downtime Generally available for Transport vehicles to provide loss of Income or Hire vehicle or Finance payments in the event of:The vehicle being off the road as a result of claim 1st being accepted under the conditions of a Motor Vehicle policy.

Purpose

Similar policy also available for Aviation Commercial Boat policies (where Income claimed …usually subject to proven contracts Policy Divisions Settlement Level of cover Asset only

Rating factors

Indemnity (market Value)

“Silver” (defined events)

Description of Truck, Finance repayment value, claims history Usually 1/3rd of a monthly finance repayment and Indemnity is max 4 months repayments

Premium

Excess

Situation

Usually 7 to 14 days

Mobile

General

Best Practices: 9 Very few clients consider such a policy due to budget constraints or own controls in place.

Trivia

Excess usually renders this cover uneconomical

EMPLOYERS INDEMNITY

See "Workers Compensation" (see listing).

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Disability Provide Personal Income in the event of an Accident or Illness to an Individual. There are several other policies that do the same thing but with different titles:Disability, Income Protection, Personal Accident and Illness, Voluntary Group PA, Salary Continuance

Purpose

Rating factors

3 sections to a policy 1. Accident (external Injury) – weekly benefit 2. Capital (lump sum) - Total Sum insured.

• This section deals with Life (death) and TPD (Total Permanent Disablement). In the event that the insured’s injury exceeds the prescribed period of benefit under Accident or Illness this section becomes active. It will pay out the lump sum proportionate to the severity of the injury.

3. Illness (internal Injury) – weekly benefit o Accidental and Illness provide a weekly benefit for a prescribed period – usually 1 or 2 years from the date of injury.

Extension for “Business Expenses” can be acquired. Medical costs are not covered Scope of Cover – This can be 24 hours a day include work or non work related activities Policy Divisions Settlement Level of cover Asset only Indemnity (market Value) “Silver” (defined events) Occupation, Age, Smoker, claims History, Benefit period (104/52 weeks), hazardous sports Min premium is $275. Sample pricing below based on 24 hours including work and leisure time

Premium

Excess See below for samples

Situation Mobile Approx Cost

Section Priority Excs Settlement SERVICE INDUSTRY $250 per $500pwk Disability Accident Indemnity Value 1 wk $---4. per $1,000 03 Capital $520 per $500pwk Illness GOODS SOLD INDUSTRY $270 per $500pwk Disability Accident Indemnity Value 1 wk $---6. per $1,000 03 Capital (lump sum) $480 per $500pwk Illness TRADES INDUSTRY $380 per $500pwk Disability Accident Indemnity Value 1 wk $---6 per $1,000 03 Capital $490 per $500pwk Illness Same cover, but a lower price is available under a Group Disability or Salary Continuance Plan…

General why…. These policies are designed for 5 to 10 or more people. This means 1 policy with many people so less admin and larger premium.

Most insurers only pay out 85% of the proven income (personal income) this being an incentive for the insured to get back to work. Partial disablement reduces claim to 25%

Most policies only cover “personal Income” (this means the Income accessible for Tax, after all tax deductions). Many sub-contractors want to insure for a value beyond their personal taxable income and they should be informed the insurer will not pay for this (it’s a bit like insuring a car for more than the market value).

Why “Betterment” (it is not the intention for a policy to allow an insured to profit from a loss).

Typically most small businesses have the benefit of various tax deductions that may infact be personal however through good accounting strategies these deductions become counter productive in terms of showing the real Personal Income require for a disability policy.

Trivia

No cover for Medical costs, pre existing injuries, hazardous work or leisure time pursuits unless noted.

We have recorded common FAQ’s on this topic – How much can I insured for, what is Income, what do I insure, what is Business Expenses, what is the Indemnity period, why are excesses applied, What is meant by Scope of Cover, why aren’t medical costs included in the cover, is there an age limit, Cover versus W.Comp

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Engineering (Machinery Breakdown) To cover above-ground Mechanical, Electrical and Electronic driven plant against loss caused by mechanical and/or electrical breakdown including sudden and unforeseen events.

This type of cover also known as Machinery Breakdown. (Fusion is a restricted form of cover).

Some insurers offer full replacement and others apply depreciation due to the age of the motors (depreciation is usually applied to sealed motors).

Purpose

Policy Divisions Settlement Level of cover Rating factors

Extensions of cover:• Electronic items (some policies already include) Electronic Data Loss of Income Generally only addresses Breakdown but can include aspects of a Computer / Electronic equipment policy.

• Boiler explosion, Pressure vessels, Air Receivers explosion or collapse • Loss of Income (usually for large manufacturing plants) • Spoilage of (chilled) Foods refer to "Spoilage" (see listing) 3rd Party (property and Bodily injury) Liability “Boiler explosion” is also available (note some insurers will include this Liability under their standard Public/Broadform Liability policy).

Asset only Asset and/or Liability Liability only Yes Yes No Replacement New for Old Indemnity (market Value) Generally Yes Yes “Gold” – (broadest cover) “Silver” (defined events) “Bronze” (restricted) No Yes No Type of equipment, Size/Capacity, Industry of use, Sum Insured, Claims history

Premium

Minimum $300

Excess

Usually around $100 small items and $200 larger and depreciation can apply to sealed motors

Situation

General

Trivia

Small General Retailer say $500

Small General Manufacturer say $750

Static / fixed location only

Mobile

Not applicable

Not applicable

Best Practices: 9 Purchase cover within a Package policy – lower rate – see “Package Policy” 9 Many clients do not take this cover, they consider o Premium against frequency of claims, high excess and deprecation limits on age of machines and own controls to minimize loss.

9 No cover against events normally covered under other policies such as Fire and Perils and Burglary as you are expected to activate these covers separately.

9 Sum insured or "Limit of Indemnity" should be the value of the parts that break down ie., motor and associated parts and not the entire machine. o Example an airconditioner system may worth $50,000 however motor is only worth $15,000 You would insure the entire value under Fire and perils but only the motor value under this section for Breakdown.

• No cover for loss caused by wear and tear ie, lack of maintenance (just like a car).

• No cover on items that are meant to wear down such as:• Belts, Flaps, Fuses, Filters (these are maintenance items like those on a motor vehicle).

• Conversion of KW to HP is .75kw = 1hp ie., 2kw = 3hp

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Ex Patriate To provide Health Insurance for Australians domiciled overseas.

Purpose Policy Divisions Settlement Level of cover Rating factors

Premium

There are many corporations who have employees and their families seconded overseas. This product guarantees their standard of Health Insurance is not compromised.

Asset only Asset and/or Liability Liability only Yes Replacement New for Old No

No Indemnity (market Value) Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Sums Insured, Number of singles, couples and families including accompanying children, Claims history, Occupation of Insured Person - nature of work including typical daily duties Medical Expenses total Sum $500,000 $1,000,000 Excess Options 1. $500 annual aggregate $2,000 Single $2,500 Single $4,000 Couple $5,000 Couple 2. $1,000 annual aggregate excess $1,750 Single $2,200 Single $3,500 Couple $4,400 Couple A $55.00 UW Policy Fee including GST is applicable. + Broker fee. No stamp duty or GST is payable.

Children An additional 25% of the Single premium is payable for each accompanying child.

Excess Situation $250

General

No

Within Australia

Accident & Health International can assist in evacuation of expatriates from areas where medical treatment is inadequate. We will pay to transport our clients to the nearest and most suitable facilities.

We also guarantee acceptance into private Health Insurance once a client has returned to Australia following their period of secondment, without the normal waiting period.

Expatriate Insurance is also available for individuals.

Features • Emergency Evacuation • Health Fund extension when visiting Australia • Special Health fund access upon permanent return • Specified Ancillary Benefits • Emergency Assistance Network • Funeral or Mortal remains transportation (limit $10,000) Proviso’s • Subject to satisfactory proposals • Pre-existing conditions are excluded unless agreed to in writing.

• A twelve-month waiting period applies to Pregnancy/Childbirth claims.

Wording - This expatriate insurance provides broad and comprehensive medical expenses coverage. It includes cover for ancillary benefits such as optical and dental expenses in a similar fashion to an Australian Health Fund. However unlike an ordinary health fund we also cover the costs to evacuate someone (say via air ambulance) for a serious life threatening medical emergency if the treatment is unobtainable where they are expatriated.

There are many other benefits as are the case with Heath Insurance – a policy wording is needed to view the full scale of benefits. (AHIU have 1 on their website)

Trivia

Rates can be pro rata to a min of 3 mths – a 10% loading may apply

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Farmpak A Packaged cover for Farming risks.

Purpose

Policy Divisions Settlement Level of cover Rating factors

--------------------------------------------------------------| RISK SECTIONS AVAILABLE FOR YOUR CONSIDERATION:| |---------------------------------------------------------------| |[01] HOME COVERS FOR HOUSE, CONTENTS & LIABILITY |^YES^NO | |[02] FARM BUILDINGS & CONTENTS |^YES^NO | |[03] UNSPECIFIED EQUIPMENT/MACHINERY |^YES^NO | |^YES^NO | |[04] SPECIFIED MOTORISED MACHINERY (UNREGDT) |[05] LIVESTOCK/FENCING/HAY/CROPS |^YES^NO | |[06] ADDITIONAL COSTS |^YES^NO | |[07] BURGLARY |^YES^NO | |[08] PUBLIC / PRODUCTS LIABILITY |^YES^NO | |[09] MECHANICAL/FUSION/SPOILAGE |^YES^NO | |[10] PLEASURE CRAFT |^YES^NO | |[11] TRANSIT COVER (marine cargo) |^YES^NO | |[12] MOTOR VEHICLE |^YES^NO | |[13] DISABILITY |^YES^NO | |[14] ELECTRONIC EQUIPMENT |^YES^NO | |---------------------------------------------------------------| Asset only Asset and/or Liability Liability only Yes Yes Yes Replacement New for Old Indemnity (market Value) Various

Various

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

Certain sections

Certain sections

No

Location, Value of each Asset to be insured, Security, claims history Premium Indicators: per $1,000 Homepak (Home, Contents, Valuables) Fire & Perils rate for: Fire only cover for Burglary Machinery Breakdown

Premium

Spoilage or Deterioration of Milk Comprehensive rate on Farm Equipment:Tractors $.50 Harvesters $.70 Trucks $1.0% + add around $70 Road Risk Liability Note – option available to insure for Fire only to reduce premium Public Liability $2,mil for 02 people $210 or 6-10 people $315. approx $1.0 based on F.F.C.O. Transit cover (marine cargo) Excess Situation Depends on sections taken

General

Trivia

same as under "Homepak - standard".

Farm Buildings $3.0, Farm Equipment $3.0 Livestock $1.5 Fencing $4.0 Hay $3.0 Plant and Equipment $3.0 Small items $30.ea Refrig items $70.ea Submersibles $60.ea $10. per $1,000

Static and mobile

Best Practices 9 Have to look at each policy section to view each best practice • House & contents - includes Personal Liability but only for “domestic” events within the area used for residential purposes. The remaining land and Farm income activities need to be insured under Farm Asset and Liability sections.

•

Fire only cover is generally only applied to farming/Agricultural risks where they are out in the open or in remote areas example: o Crops, Farm fencing, Hay bails stored for feed, General Livestock

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Fire only To provide a restricted “defined event” “Fire” (naked flame) only cover.

Named flame does not include areas/surface/vessels designed or intended to be exposed to excessive heat.

Purpose

Great caution should be noted – this restricted cover is rarely used and cause considerable innocent misleading assumptions. Few people realize such a restricted form of cover exists, it does not include the expected usual “extraneous Perils” associated with a standard Fire & Perils policy.

This limited cover appears in MV - TPF&T (Third Party Fire & Theft). It can also appear in some policies covering "General Property" or "Special Contingency".

Policy Divisions Settlement Level of cover Asset only

Replacement New for Old

Rating factors

Same as “Fire & Perils”

Premium

Same as “Fire & Perils” however the rates are 50% lower.

Excess

$100

Situation

General

Trivia

Static / fixed location only

Mobile

Not applicable

Not applicable

“Silver” (defined events)

Best Practices: 9 Avoid this type of cover unless otherwise required.

9 Rate is lower to allow of high sum insured (Full value) and exposed to Average/underinsurance so over insure to avoid high loss from nominal premium.

FIRE cover DOES NOT include items exposed to a heating process, such as stoves, or exposure to the elements.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Fire and Extraneous Perils To cover Physical property against loss from “defined events” (named perils).

Purpose

Policy Divisions Settlement Level of cover Rating factors

Fire is self explained a naked flame but not areas/surfaces/vessels that are designed or intended to be exposed to extreme heat.

Extraneous Perils are such events as but not limited to:Malicious Damage, Storm and Tempest, Water leakage, Explosion, Impact from Vehicles/Animals/Aircraft, Riots and Strikes, Earthquake, and as further negotiated.

Asset only Asset and/or Liability Liability only Yes No No Replacement New for Old Indemnity (market Value) No

Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Occupation/Use, Hazard of items, Location, Fire prevention facilities, Claims history, Size of Sum insured.

Minimum $100 Premiums vary according to hazard. Example of rates per $1,000:Office Risk: = $2.5 Low risk Retailer = $5.7 Low risk Manufacturer = $3.7

Premium Any Fire hazard (Chemicals or Flammables) around = $9.50 If Country or remote location add say 20% loading Excess Situation

General

Trivia

Any Wood/Paper Industry = $1.4

Business usually a] Earthquake $1% or $20,000 and b] Malicious Damage of $150 Static / fixed location only

Mobile

Not applicable

Not applicable

Best Practices: 9 Purchase cover within a Package policy – lower rate – see “Business Pak” 9 Rate is low to allow of high sum insured (Full value) and exposed to Average/underinsurance so over insure to avoid high loss from nominal premium.

9 Sum Insured should allow for many extra benefits such as:o Work in progress, Customers Goods, Loss of Rent, Extra costs of Reinstatement, re writing of records, cost to remove debris, inflation of overseas purchases.

9 If you have a fluctuating stock levels ask for a Stock declaration clause (You confirm your stock value each month/quarter (as agreed) and adjust premium by renewal declaration). o Under insurance applies so over estimate the value and get a refund by adjustment.

9 Consider a “Consequential Loss of Income”o it provides loss of income upon a claim under this section. o The insurer will expedite settlement to avoid consequential loss claim. o If the Cons Loss premiums is too high reduce to ICOW cover only 9 If the values are substantial (over $2mil consider an “I.S.R. Policy” – it has broader cover) If you occupy your own building you need to make allowance for alternate rent costs as you would have this as well as your mortgage payments to budget for if you had to re-locate.

"Loss of Rent" contingency is better placed under “Cons Loss of Profits” section! see trivia under that section for explanation.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Fidelity Loss resulting from Fraud/Dishonesty by staff of insured's (not customers) money/goods.

Purpose

There is also an extension within a PI (Professional Indemnity) policy for loss to client/s.

Policy Divisions Settlement Level of cover Asset only

Rating factors

Indemnity (market Value)

“Silver” (defined events)

Occupation, T/Over, Limit required, Claims History Min premium $550. Rates generally 2% of sum insured

Premium

General

Trivia

Excess

Situation

$250

Not applicable

Best Practices: 9 Must demonstrate reasonable case for fraud been committed ie., not just shorted of stock take or invoicing.

9 Some policies required suspect to be named.

9 Purchase cover within a Package policy – lower rate – see “Business Pak” 9 Several options are available such as: o staff to be named?, Relief staff covered?and Non-prosecution clauses.

9 Broader cover options (more cost) available under “Crime” policy o Very few clients consider such a policy due to budget constraints or own controls in place. It is likely valued to Corporate or Exotic based activity clients, or those that have experienced the need to have such cover.

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Fusion This is a restricted form of cover for “Machinery Breakdown”. It only covers above-ground Mechanical and/or Electrical driven plant against loss the motor resulting from the flow of electrical current.

Purpose

Unlike a Machinery Breakdown policy it does not cover sudden and unforeseen events as well as any associated parts such as pipes, regasing etc., and depreciation is applied before any excess is deducted.

Policy Divisions Settlement Level of cover Asset only Indemnity (market Value) “Bronze” (restricted)

Rating factors

Type of equipment, Size/Capacity, Industry of use, Sum Insured, Claims history

Premium

Minimum $300 and rates are generally $50.00 per item up to say 3hp.

General

Trivia

Excess

Situation

$100 plus depreciation at around 10% per year.

Static / fixed location only

Best Practices: 9 Purchase cover within a Package policy – lower rate – see “Business Pak” 9 Many clients do not take this cover, they consider o Premium against frequency of claims, high excess and deprecation limits on age of machines and own controls to minimize loss.

There is a much broader form of cover under "Engineering” (see listing).

You should also consider taking a "Spoilage" (see listing) to cover loss of chilled foods as a result of the motor burning out.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Purpose

Glass – Fixed To afford replacement of Fixed Glass forming part of the Building including internal Fixtures (non moveable furniture) Policy Divisions Settlement Level of cover Asset only

Rating factors

Replacement New for Old

“Gold” – (broadest cover)

Approx number of windows, square volume of windows, claims history Minimum premium $250. Usually around small $350 Medium $500 Large $750

Premium

Excess

Situation

$250

Static / fixed location only

General

Best Practices: 9 Purchase cover within a Package policy – lower rate – see “Business Pak” 9 Not always taken, consider your exposure based on the Premium, Excess and Target value of your premises.

9 You must nominate if cover is for Internal and/or External Fixed Glass.

9 List any external neon signs and a value (as they are outside the premises) 9 The policy covers the replacement value and optional extras such as:o signwriting, temporary shuttering, damage to stock etc.,

Trivia

call out repairs are “after hours” will cost up to triple the normal rate.

GROSS PROFITS

[1] Same as "Consequential Loss of Profits" (see listing).

HEALTH INSURANCE - This covers medical costs associated with personal health. This is additional to the compulsory cover of medicare. There are a variety covers which can include ancillary benefits for Dentists and other specialists. We do not service this product however we can refer you to specialists.

INDIVIDUAL PERFORMANCE

See "Cancellation Abandonment and Non Appearance" (see listing).

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Purpose

Policy Divisions Settlement Level of cover

Plant Hired In To provide cover on Plant Hired in.

Typically this policy is designed for “C.P.M.” (Contractors Plant and Machinery) used by the Earthmoving or General Contractors where there is a need to Hire in a variety of plant. The cover is the same as "CPM” policy.

The policy is usually created on an annual estimate premium and adjusted on a renewal declaration.

Asset only Asset and/or Liability Liability only Yes Replacement New for Old

Optional

No

Not usual Indemnity (market Value) Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

Yes

No

No

Rating factors

Industry, Type of Plant Hired, Largest Sum insured required, estimated annual rental paid for plant hired, claims history

Premium

Minimum premium $350. Rates similar to "CPM” policy.

Excess

Same as "CPM” policy.

Situation General Trivia

Static / fixed location only

Mobile

No

Yes

Best Practices: 9 Lower rates if in a Package policy – lower rate – see "CPM” policy.

The cost of this policy will generally be approx 30% cheaper than the cost loaded to a plant rental agreement.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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General Property This is ideal for a sub-contractor or a mobile operator when tools (and Sundry stock) are on the move.

Purpose Policy Divisions Settlement Level of cover Rating factors

Premium

The policy is designed to cover trade “tools” (limit per item unless specified). Some allowance for stock if specified, when outside your place of business. The territorial limit is usually within the state Asset only Asset and/or Liability Liability only Yes No No Replacement New for Old Indemnity (market Value) Generally No Yes “Gold” – (broadest cover) “Silver” (defined events) “Bronze” (restricted) Yes Yes No Claims History, Occupation, Location, Total sum insured, Level of cover, Standard non Disclosure questions (found on any proposal These are indicative prices as a general guide Cover Level Base Rate Total Rate Excess DE (silver) 3.50% of sum insured+ charges = 5.00% of sum insured $250 AD (Gold) 4.50% of sum insured + charges = 6.50% of sum insured $250 Minimum premium for a standard alone policy $300 total or a package policy $200 High risk items (mobile phones) or communication mediums tend to have a 100% loading because of the high frequency loss.

Excess Situation

$250 Static / fixed location only

Mobile

No

Yes

Two (2) levels of cover:“Silver” (DE Defined Events) also known as “Specified Events”, such as..

• Fire and Perils, Accidental Damage resulting from collision or overturning of the conveying vehicle and/or Burglary from a locked vehicle or permanently sited building.

General

Trivia

“Gold” (APD – Accidental Physical Loss) also known as “Multi Risks” • All the benefits of “Silver” and with broader scope of Accidental Damage. Note always these policies do not include electrical derangement (not working) unless resulting from external Physical damage or “Open air” theft.

Best Practices: 9 Purchase cover within a Package policy – lower rate – see “Business Pak” 9 Check to see if policy is replacement or Market value as it effects how much you must declare.

9 Some insurers use same cover titles but have different definitions of “defined events”.

1. Some policies do not include "Perils" (perils being “Earthquake, malicious damage, storm and the like").

2. If this cover is part of a Package policy some of the Perils may not be included as it is presumed you have activated the Fire section of a Package policy 3. Sum insured: General most policies are “Indemnity” meaning market value (not replacement) so in determining your sum insured you should consider current market value of the equipment ie., the insurer will replace the item new price, less depreciation / wear and tear value.

4. Limits: Most insurers have item limit of $1,000 per item unless specified (no different than home policies).

5. Burglary does not include from “open air” ie., back of Ute/Truck unless special arrangements have been made. (Burglary is defined as violent and/or forcible means from (not upon) a vehicle or premises).

6. Stock. Most insurers can include sundry stock but check if needed or allowed.

7. Large items should be placed under a CPM policy which has broad cover (full AD like a MV policy) 8. Cargo policies – these are cheaper but usually restrict cover to and from the vehicle and not at a land base location. This may be a better option but only if the equipment is always stored in the vehicle.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Purpose

Policy Divisions Settlement Level of cover Rating factors

Premium

Excess Situation

General

Trivia

Home Pak – Standard To cover a Domestic Home and/or contents. The policy automatically includes a variety of covers such as Fire and Extraneous perils, Burglary, Fusion, Glass, Open air cover, Liability etc., Additional options:• "Accidental Damage" (other than glass) • "Multi Risk" for Valuables at or away from home, either Specified or Unspecified blanket cover (unspecified items will have a limit per item) • "Workers Compensation" to cover casual workers (Baby-sitter or cleaner) Asset only Asset and/or Liability Liability only No Yes No Replacement New for Old Indemnity (market Value) Yes generally contents up to 15 years Negotiable “Gold” – (broadest cover) “Silver” (defined events) “Bronze” (restricted) Optional Standard No Age/decade built, Construction, Location, Sums Insured, Security provisions; Deadlocks to all doors/windows, Alarms - local or back to base, claims history.

Buildings average rate $100 + $2.00 per $1,000 Contents - average rate $100 + $5.80 per $1,000 Accidental Damage cover - usually 25% loading Multi risk cover – average rate $90. per $3,000 Domestic Workers Comp – approx $75. pa (if included in the same policy otherwise $205) Minimum premium for a policy $300 Example: Cover: Defined Events Suburb: Leeming Construction: Built in 1980’s, Brick, Tile Concrete Security: Deadlocks on all Doors, Key Locks on all Windows, Patio Bolts Claims: Nil (last 5 years) Building: $ 150,000 Contents $ 40,000 Unspecified Personal Valuables ($ 3000) Average Premium: $ 669.45 (inclusive) $100 + earthquake Static / fixed location only

Mobile

Yes

Certain sections

Best Practices: 9 Whilst many benefits automatically included the sub limits vary between insurers so PLEASE INDENTIFY the main areas of your concern ie., Fences or Fusion or Valuables, Open Air? 9 Sum Insured should allow for many extra benefits such as:o Inflation, Loss of Rent, Extra costs of Reinstatement, cost to remove debris 9 Rate is low to allow highest sum insured (Full value) and exposed to Average/underinsurance so over insure to avoid losses from nominal premium.

9 If you seek a lot of “Multirisk” cover for valuables consider a Luxury homepak.

9 Domestic Liability will respond to sections insured ie., Building re ownership of the property (including as Landlord). Contents re ownership of all contents anywhere in Australia.

9 Strict condition of “Domestic” activity, therefore no cover for Business Assets or Liability, other than for office/admin at home. Ie., mobile phones and Laptops if used for business will not be covered.

9 Rental property see "Landlords" 9 We have separate dedicated brochures and helpful guide for Contents values Most contents insurers are New for old up to 15 years and thereafter it's a market value system. Note that some contents such as clothing and sporting equipment are only covered on a market value basis.

VALUABLES AT HOME:- All home policies have a limit on valuables otherwise listed. Valuables means such things as Curios, works of art, Fur, Jewellery, Coin or stamp collections. The limit between $500 to $1,000 per item and limited to around 20% of the total sum insured.

Prepare and supply a list of valuables so there is no dispute at the time of a loss. Alternatively take photos or a video of your contents and store away from home so that in the event of a claim there is less confusion or questions as to what you had.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Home Pak – Luxury Same as Home Pak -standard however designed for target market Target market – Buildings over $500,000 Contents $250,000 The policy includes additional benefits to recognize the higher values and premiums.

Special benefits:Full accidental loss/Damage wording Most insurers auto include “Multirisk” cover on all contents – very attractive for valuables and contents in transit

Purpose

Policy Divisions Settlement Level of cover

Sample of “Chubb’s “Luxury Home Benefits”:No Proposals/Claim forms No alarm warranties are applied BUILDINGS - Written Valuation, Replacement cost beyond Sum Insured CONTENTS # Accidental Damage # No Depreciation applied # Cash Settlements # Worldwide Coverage # Higher limits on special contents unless listed Per Loss = Jewellery $10,000 Furs $5,000 Silverware $10,000 # No limits on Computers/Cameras/Fine Arts (including Antiques) OPTIONAL - Domestic Workers Comp Asset only Asset and/or Liability Liability only No Replacement New for Old

Yes

Yes

No Indemnity (market Value) Negotiable

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

Yes

No

No

Rating factors

Same as Home Pak -standard

Premium

Minimum Values Building $500,000 Contents $250,000 Premiums – approx 15% higher than Home Pak -standard however note additional benefits included AND policy is GOLD COVER

Excess

$500

Situation General Trivia

Static / fixed location only

Mobile

Yes

Certain sections

Best Practices o Same as Home standard Better to view a current 1 page product brochure and as for a summary of unique claims covered by this policy in preference to a standard HPK policy.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Home Warranty A unique policy to provide a warranty on the structural performance of the Building.

New building laws require warranty on structural condition for 7 years from construction.

If an owner builder sells their house within seven years of the date of issuance of the building license they must obtain home indemnity. You DO NOT need to take out this cover at the time you are building your house. The Home Building Contracts Act exempts you from this sort of policy. The policy needs to be activated when you decide to sell the building. In order to purchase Home Warranty insurance a building inspection report will be required.

Purpose

Summary extract of cover: The Policy will cover you: If you are not the builder, where as a result of a prescribed cause you or your successors in title claim under the Policy: to recover the loss of the deposit under the residential building work contract; to recover the loss resulting from the non-completion of the residential building work; or to take advantage of an entitlement to, or to enforce or recover under, a remedy under section 12A of the Builders Registration Act 1937; and If you are the builder, where your successors in title claim under the Policy because they are unable to take advantage of an entitlement to, or to enforce or recover under section 12A of the Builders Registration Act 1939 as a result of a prescribed cause.

PERIOD OF INSURANCE: The period in respect of which claims may be made commences on the date of the relevant Residential Building Work Contract or date of issue of the building permit for the relevant work (whichever is the earlier); and expires on the date being six(6) years from the date of practical completion of the residential Building Work. Provided that the Insured shall have 90 days from expiry of the period of insurance in which to notify the Insurer of any matter of which he became aware during the period of insurance as existence of grounds for a claim.

Policy Divisions Settlement Level of cover

Asset only Yes Replacement New for Old

Asset and/or Liability Liability only No No Indemnity (market Value)

Yes.

No

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Rating factors

Proposal required, Location, Type of structure, Materials used, Value of building, age.

Premium

Not known. Minimum $800

Excess

$500

Situation General

Static / fixed location only

Mobile

Yes

Certain sections

No volume of dealings in this risk – no best practices recorded.

Registered Builders are required to have this at the completion of the contract

Trivia

Owner Builders may not be required to have this at time of completion (depends on the council, they may only be required to produce if they sell within the warranty period?)

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Inbound Medical Expenses This policy provides Health Insurance for Non Australian persons visiting Australia.

Purpose

Policy Divisions Settlement Level of cover

Rating factors

Many people, particularly those who come to Australia to work, require Health Insurance before they are given their work visa. We can provide cover similar to that afforded by Australian Health Funds at a very competitive premium.

Asset only Asset and/or Liability Liability only Yes No No Replacement New for Old Indemnity (market Value) No Yes “Gold” – (broadest cover) “Silver” (defined events) “Bronze” (restricted) No Yes No • Sums Insured • Number of singles, couples and families including accompanying children • Claims history • Occupation of Insured Person • Details of sums insured • Details of annual aggregate excess

Premium

Similar to Ex Patriate

Excess

Usually $100 plus depreciation at around 10% per year.

Situation

General

Static / fixed location only

Mobile

Yes

No

Standard Benefits • Medical Expenses - $500,000 • Funeral Expenses - $10,000 • Excess - $500 • Aggregate Limit - $1,000,000 Wording - Standard Inbound Medical Expenses Best Practices o Can not get confirmed pricing without completed proposal.

Trivia

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Income Protection The policy is designed to “Protect an Individual’s Income”, there are several other policies that do the same thing but with different titles:Disability, Income Protection, Personal Accident and Illness, Voluntary Group PA, Salary Continuance Disability – same product – see this section for more product detail including costs.

Income Protection – same but with an option to guarantee a renewal invitation – useful if poor claims history but there is a cost for the option.

Voluntary Group PA, - Same as Disability but 1 policy with non rewarded people on 1 policy,

Purpose

Salary Continuance – Same as Group PA but designed to cover non work activities.

Income Protection:The essential difference with this Product is that it is “Non cancelable”. This means the insurer can not cancel or rather decline to offer renewal, however there is an extra cost to this benefit.

A quick comparison between the two products

Policy Divisions Settlement Level of cover

Disability Income Protection Covers Accident, Illness and Capital Yes Yes Typical / standard Excess 7/14 days 28 days Renewal type/offer negotiable guaranteed Average difference in price 30% less 30% more Age limitation usually 60 to 65 60 to 65 Indemnity period (how long covered upon a claim) 1/5 years to age limitation Asset only Asset and/or Liability Liability only Yes No No Replacement New for Old Indemnity (market Value) No “Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Rating factors

See Disability listing

Premium

See Disability listing

Excess

See Disability listing

Situation

Yes

Static / fixed location only

Mobile

No

Yes

General

Best Practices 9 View the “Disability” check list page – it is in broader detail.

Trivia

Listed under Disability

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Innocent Mortgagee Protection The policy is designed for the Marine Industry…. to Protect the Innocent Mortgagee where the Indemnity provisions are prejudiced by a breach of policy conditions by the insured.

Purpose

Policy Divisions Settlement Level of cover

This special cover is created due to the risk being governed by the MIA - see “General comments” below.

Asset only Asset and/or Liability Liability only Yes No No Replacement New for Old Indemnity (market Value) No

Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Rating factors

Insured details, Claims history, Mortgage value and Asset Value.

Premium

Min premium $500. The Rate is generally around .10c

Excess

$500

Situation

ie., $50,000 = $500.00 (no S/duty on marine)

Static / fixed location only

Mobile

No

Yes

In summary....

The insuring clause basically states that they will indemnify or the Assured (Financier) for a loss that is otherwise denied due to some breach of the policy by the insured (the client).

1. The Marine Act makes no provision for protection of innocent mortgagees or 3rd parties so a policy is created.

General

2. Under the ICA (Inc Contract Act - General) section 54 deals with this issue however this Act only governs General policies whereas all issues relating to Marine Risks are under the Marine Act. NB: The policy should always be placed with he same insurer as the insurer of the vessel (it would be a shock to find any insurer that would offer the cover with the vessel anyway) - do you know why - the answer should be obvious.

Best Practices: 9 Double check the intention of over as this product causes some confusion with similar titled risks.

Rate varies according to the Risk - the higher the lending the greater the risk - why ?

Trivia

Why - It's a morale problem. The client is aware that even if they breach their obligations the mortgagee will be paid out and thus their debt is reduced - so if there is little equity the client has little to lose by not complying with the rules.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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I.S.R. Industrial Special Risks To cover large value Commercial Risks – minimum value $2,000,000 The type of cover is "Material loss and/or Damage. This cover is far broader than "Fire & Perils" and therefore desirable whenever possible. Rates are negotiated on the total value of Assets being a combination of the following 2 sections:1) All Material assets being Buildings and All Contents.

2) Consequential Annual Loss of Gross Profits. Indemnity period = ___ mths

Purpose

$ TBA $ TBA

Ironically it is similar in concept to a Home Pak policy, in that you nominate a Sum insured and auto include a variety of sub limits benefits such as Accidental Damage, Burglary, Glass, Money, Fusion etc., The advantage - Policy limits are quite different to a standard policy. With an “ISR” the trigger for cover is broader and insurer has the responsibility to restrict sections of covers and sub-limit the values for defined events.

Policy Divisions Settlement Level of cover

Rating factors Premium Excess

Asset only Replacement New for Old “Gold” – (broadest cover) Occupation, Location, Asset Value, Security, Construction type, all other factors that would be required for each section, claims history.

Minimum premium $1500 otherwise a rate around 50% to 100% higher than Fire & Perils however it will include all sub limit benefits, as negotiated. $500 + earthquake Excess of 1% of sum insured or $20,000

Static / fixed location only Mobile No Yes Best Practices: 9 Determine maximum limit required per site for Material value and Cons Loss – provision to declare asset value on expiry if over insured to get refund.

9 Under insurance clause exposure same as Fire and Perils.

General 9 Cons Loss – depending on the size of the risk consider a longer recovery period to be insured.

9 All other sections of cover the same as Business pak but Liability can not be included, separate policy required.

9 Need to consider a variety of extensions to enhance cover – see sample list below Many traditional Business Pak policies have been enhanced to include extra benefits to compete with Trivia the product however the wording is still different.

Excess on ISR usually expect to be higher than a BPK policy Diverse selection of policy endorsements:Situation

ACCOMPANIED BAGGAGE IN AUSTRALIA ACQUIRED COMPANIES ART WORKS & CURIOS AUTOMATIC REINSTATEMENT AWARD LIABILITY FOR EMPLOYEES CLOTHING &/OR TOOLS BOILER PRESSURE VESSEL BUILDINGS OF HISTORIC INTEREST CHANGES IN TEMPERATURE CONTROLLED ENVIRONMENT CIVIL AUTHORITY COMPUTER SERVICES CONSTRUCTIVE TOTAL LOSS COST OF LOCKS AND KEYS COSTS OF CLEARING DRAINS CUSTOMERS' GOODS DECLARED VALUES DESIGNATION CLAUSE EXCLUDED COMPANIES EXPEDITING EXPENSES EXTINGUISHING EXPENSES EXTRA COST OF REINSTATEMENT GOODS SOLD BUT NOT DELIVERED LABELS, CONTAINERS & WRAPPINGS

LANDSCAPING LEASED EQUIPMENT LIABILITY FOR DUTY LIABILITY TO MAKE ENQUIRIES LODGERS MONEY EXTENDED DEFINITION OUTPUT REPLACEMENT PAIRS AND SETS PECUNIARY OR ECONOMIC INTERESTS ACQUIRED PERSONAL PROPERTY OF EMPLOYEES OR OTHERS PROFESSIONAL FEES PROPERTY OF GUESTS REMOVAL OF DEBRIS REWRITING OF RECORDS SPRINKLER LEAKAGE UNDAMAGED FOUNDATIONS UNPACKING EXPENSES VALUATION OF PROPERTY SECTION 2 ACCOUNTS RECEIVABLE CLAIMS COSTS EXTENDED CLOSURE BY ORDER OF PUBLIC AUTHORITY CONTRACTUAL FINES & PENALTIES

DELAY IN AVAILABILITY/COMPLETION DENIAL OF ACCESS DUAL PAY-ROLL DELETED GOVERNMENT INCENTIVES GROSS RENTALS INFECTIONS, DISEASE, MURDER AND CLOSURE INTERDEPENDENCY - AUSTRALIA INTERDEPENDENCY - WORLD WIDE INTERFERENCE WITH ACCESS ISOLATION BY LANDSLIDE OR FLOOD LOSS ATTRACTION MOTOR VEHICLES PORT BLOCKAGE PUBLIC UTILITIES RENT PAYABLE RENT RECEIVABLE SEVERANCE PAY SPECIFIED CUSTOMERS SPECIFIED SUPPLIERS &/OR CUSTOMERS PREMISES TRADE EXHIBITIONS VALUE ADDED TAX

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Journey A special policy created to cover employee’s private Journey to/from *work due to changes to the Workers Compensation laws in 1994:Basically this policy offers a Disability benefit for specified events.

Purpose

*work generally means the employer’s place of business or work related tasks for which you are being remunerated by the employer.

The Workers Comp exclusion (1994) only applies to the daily act of the 1st and final travel to their “employer’s place of work”. All work related (employer directed) journeys are covered under Workers Comp.

Rating factors

Premium

Policy Divisions

Settlement

Level of cover

Asset only

Indemnity (market Value)

“Silver” (defined events)

Employer name, Industry, number of staff, Claims history.

There is 2 levels of cover: 1] Basic Journey cover only =approx. $60 per person Min Premium per policy $500 2] 24 Hour (7 days Non-Work) Accident cover = approx. $220 per person Excess Situation Nil

General

Trivia

Mobile

Best Practices 9 There is no obligation to provide such cover – unless you want to provide a fringe benefit.

9 The cover is a restricted form of Salary Continuance policy 9 Also consider a Corporate Travel policy if sending staff interstate/overseas 9 Why was it introduced?

Answer: A means of reducing claims costs. Many arguments arose as to what is a journey to and from work – some people may have deviated from their regular route ie., stopped at the pub, had a few drinks and rendered some sort of injury. The difficulty was what measurement would apply that is fair to all.

The exclusion is not applicable to work related journeys What are the measurements:o It has to be work related ie., directly related to the employment, under the direction of the employer. o If remuneration is being Paid for that journey ie., it’s a work related task Once you deviate from a work related journey ie., to stop off for private / personal matters it is no loner a work related journey for the simple reason you are no longer representing your employer or under their direction.

At all times remember the intent of the deviation to cover

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Judgment Indemnity

Product

To cover the insured against financial loss arising from illness or Death of a Judge.

In such a situation the case/proceedings would have to start again and the insured would incur all of the costs to get the case back to the point prior to the incident.

Purpose

Related topic not listed "Judicial Delay" - to cover a specified sum of costs in the event that the court is unable to delivery a determination, rates would be similar to this policy.

Policy Divisions Settlement Level of cover Asset only

Rating factors

Indemnity (market Value)

“Silver” (defined events)

Similar to Life Insurance, however the other factors would be the people appearing in the case Minimum premium $500

Premium

General

Excess

Situation

Nil

Mobile

No volume of dealings in this risk – no best practices recorded.

Trivia

KEYMAN INSURANCE also known as “Succession Planning” Traditionally “Keyman” is offered to a limited group of Professionals to provide Loss of Income to the firm where that key person is incapacitated.

Example: The Dentist or Doctor … without these key people the practice can not operate. The policy is designed to provide income to the practice to maintain fixed outgoing costs such as rent, support staff wages etc., The trigger to the policy is Accident and/or Illness. The policy can also include Life Insurance The Keyman product has been enhanced by Financial Advisor groups to include “succession Planning” ¾

Success planning affords the option for a partner to receive lump sump payment resulting from Death or permanent Injury of another partner. In the event of claim the benefits are paid to the estate and the deceased’s shareholding is passed to the remaining partners.

We do not service this product however we can refer you to specialists.

The rates are dependant on Life Insurance rates:¾ Age, Occupation, Health There is a need to have lawyers produce a “deed” to ensure there is no dispute as to the “succession Plan”.

Alternative covers to Keyman Insurance are Trauma cover – lump sum pay-out in the event of a measured traumatic experience Disability - Loss of personal Income resulting from a Accident and/or Illness Workers Compensation – Loss of Personal Income and Medical costs resulting from work related injury

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Landlords - Commercial A dedicated policy for a known risk Typically this risk is packaged under a “Business Pak” Policy which affords a selection of covers as required.

Purpose

Policy Divisions Settlement Level of cover

1) Fire & Perils for Buildings, Removal of Debris and Extra costs of Reinstatement.

2) Accidental Damage for Damage to L/Lords Property 3) Loss of Gross Profits for Loss of Rent.

4) Burglary for L/Lords property & damage to premises 5) Glass for Fixed glass 6) Liability for Property Owners 7) Machinery Breakdown; Aircon, Lifts Elevators etc., 8) Workers Compensation – caretakers or defence costs for allegation cover on legal costs

Rates are same as found under appropriate Business sections separately listed.

Asset only Asset and/or Liability Liability only Yes Replacement New for Old

Yes

Depends on section taken

Yes Indemnity (market Value) Depends on section taken

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Rating factors

Location, Quality of the property, Hazard of the tenant/s, Sums Insured, claims history.

Premium

See best practices comment below

Excess

See best practices comment below

Situation

General

Static / fixed location only

Mobile

Yes

No

Best Practices 9 We have a dedicated 1 page brochure that identifies the key sections of cover to consider together with some basic risk management advice and pricing.

9 Workers Compensation laws have changed creating a significant likelihood of exposure, for the nominal cost of the minimum premium it’s a must.

Trivia

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Landlords – Domestic A dedicated policy for a known risk Typically this risk is packaged under a “Home Pak” Policy which affords a selection of covers as required.

Purpose

Policy Divisions Settlement Level of cover Rating factors Premium Excess Situation

General

st A home pak policy is 1 designed for owner occupiers however it does make provision for the common occurrence of rental properties. The standard homepak can include Loss of Rent and Liability but it does not include a variety of dedicated options offered a special Landlords policy such as:-

Features HomePak Landlord pak Building and Landlords contents Yes Yes Loss of rent Yes Yes Tenants rent default No Yes Malicious damage by tenants No Yes Landlords Public Liability Yes Yes Landlords Workers Compensation Optional Optional Asset only Asset and/or Liability Liability only Yes Yes No Replacement New for Old Indemnity (market Value) Depends on section taken

Depends on section taken

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Location, Quality of the property, Security Sums Insured, claims history.

Building/contents – same as Home Pak Standard Malicious damage by Tenants = $20,000 for minimum premium of $250 Tenants Rent default = $annual rent = 50% of 1 wks rent - minimum prem of $200 Building/contents – same as Home Pak Standard Malicious damage by tenants = bond Static / fixed location only Mobile Yes

No

Best Practices: 9 Rate is lower to allow of high sum insured (Full value) and exposed to Average/underinsurance so over insure to avoid high loss from nominal premium.

9 We have a dedicated 1 page brochure that identifies the key sections of cover to consider together with some basic risk management advice and pricing.

9 Workers Compensation laws have changed creating a significant likelihood of exposure, for the nominal cost of the minimum premium it’s a must.

Trivia

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Libel and Slander To provide Indemnity in the event of allegation and damages of “libel and Slander” against another person/s.

This is usually taken as an extension of a Liability policy, be it under "General", "Professional", or "Directors and Officers" policy.

Purpose

Cover is also available under a "Defamation policy.

The scope of cover varies considerably under each policy so extreme caution should be taken when reviewing.

Policy Divisions Settlement Level of cover Asset only

Rating factors

Indemnity (market Value)

“Silver” (defined events)

Industry, Business size, claims history, sum insured.

Minimum premium $750

Premium

General

Excess

Situation

$500

Mobile

Best Practices: 9 Lower premium under a package policy - "Liability - Professional" and "Liability - Directors & Officers", and a very limited version under "Liability - General".

9 The policy is a "claims made" basis. That is, the claim or notice of an intending claim must be made within the currency of the policy period, regardless of the actual occurrence date so you may need to keep a policy going for many years after the initial service.

9 It is CRITICAL to verify that the policy has an unlimited date limitation. This means if the date is not limited you will be covered for claims that stem from events prior to the inception date.

9

Trivia

Very few clients consider such a policy due to budget constraints or own controls in place. It is likely valued to Corporate or Exotic based activity clients, or those that have experienced the need to have such cover.

View our FAQ’s definition of words to clarify difference between “Libel and Slander” versus “defamation”.

LIFE INSURANCE – including TPD An agreed sum payable in the event of Death of the assured person named in the policy. You can also take out an additional section known as "T&PD" (Total and Permanent Disablement)".

There is a Life Insurance aspect within a Disability policy. However it is only a yearly renewable policy, that is upon claim/s the insurer may elect not to offer renewal, whereas under a Life policy it is a guaranteed renewal and rate.

Rates vary according to Age, Sex, If Smoker and Occupation if Self Employed.

We do not service this product however we can refer you to specialists.

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Legalexpense – Commercial To cover the professional (lawyers) fees in respect to Commercial and General business disputes, as plaintiff or defendant.

SECTION 1] COMMERCIAL GENERAL EXTENT OF COVER:- Pursuit of your legal rights to obtain remedy from other parties arising from insured events:SUMMARY OF EVENTS: Employment as defined, Employers Prosecution defence as defined, contract as defined, Property as defined, Trade Practices Act as defined.

Optional cover for events involving Motor vehicle and Taxation matters.

SECTION 2] COMMERCIAL MOTOR

Purpose

EXTENT OF COVER:- Pursuit of your legal rights to obtain remedy from other parties arising from insured events: SUMMARY OF EVENTS:- Damage to Vehicles as defined, Purchase or Hire as defined, Service, Repair, Testing as defined, and Property as defined.

SUMMARY EXCLUSIONS:- Applicable to SECTION 1] AND 2] ONLY Defamation, Slander or Libel, Mining or Land subsidence, Asbestos issues, Negligent advice, Treatment advice Professional Duty, Boat / Vessel / Aircraft issues, Any Disputes with this insurer, Patents, Secrecy and confidential agreements, Disputes concerning undefended debts, Bankruptcy, Bodily Injury, Transit or property by Air or Sea, Registered Vehicles.

SECTION 3] COMMERCIAL TAX AUDIT PROTECTION EXTENT OF COVER:- Professional fees reasonably incurred in connection with the insured event.

SUMMARY OF EVENTS: When the ATO has first notified you or your representative of the conduct of an audit.

Policy Divisions

Settlement

Level of cover

Asset only

Indemnity (market Value)

“Silver” (defined events)

Rating factors

Industry/Occupation, Turnover, claims history

Premium

Based on an Indemnity / sum insured of $50,000 T/Over General per Vehicle $500,000 $425 $150 $1,Mil $750 $180 $3,Mil $950 $252

Excess

Usually 10% of costs with a minimum dispute value of $1,000

Situation

General

Trivia

Tax Audit $180 $260 $500

Static / fixed location only

Mobile

Yes

No

Best Practices: 9 The policy is a "claims made" basis. That is, the claim or notice of an intending claim must be made within the currency of the policy period, regardless of the actual occurrence date. So if you have to consider renewing the policy for events of the past (someone may raise a allegation some years after the event).

9 CRITICAL to verify that the policy has an unlimited date limitation. This means if the date is not limited you will be covered for claims that stem from events prior to the inception date.

It does not include: Taxation matters relating to:Late returns, Enquiries which are not linked to an audit, Prior notifications of intending audit, Professional fees of non Australia resident firms, Fraudulent Acts or omissions, Any improper, unwarranted or unjustified refusal or failure to comply with requests by the ATO. Cover available for business or individual and rated a] Business on Turnover or B] Individual on Salary.

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Purpose Policy Divisions Settlement Level of cover

Livestock This cover is usually reserved for quality stock, similar to a "Bloodstock" policy. The cover being mortality (death only). Cover may include Transit and some insurers may offer Theft as an option.

General livestock are insured under the Farmpak policy with cover limited to FIRE only (no perils) cover.

Asset only Asset and/or Liability Liability only Yes Yes No Replacement New for Old Indemnity (market Value) No

Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Rating factors

Location, details of animal – age / sex, Sums Insured, claims history.

Premium

Minimum premium $250 The rate is around 6% of the sum insured for mortality cover - if you only require Fire cover the rate is only around .30c

Excess

$250 this will change depending on the exotic nature of the animal

Situation General

Static / fixed location only

Mobile

No

Yes

Best Practices: 9 The same rules apply as Bloodstock"

Trivia

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Loan Also known as "CCI" (Consumer Credit Insurance).

Purpose

Policy Divisions Settlement Level of cover Rating factors

This policy is designed to pay SPECIFIC monthly loan repayment in the event of Accident, Illness or unemployment. (Unemployment is usually restricted to 3 months).

It is the same type of cover as a Disability Policy however a disability policy will pay you whereas this policy will pay the financier.

Asset only Asset and/or Liability Liability only Yes No No Replacement New for Old Indemnity (market Value) No

Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Type of loan ie., Mortgage for house or loan for car etc., Term, monthly repays and cover: Death, Injury, Unemployment, If single/joint borrower and if Smoker and Age Minimum say $200 Example of rates for Single Non Smoker on Mortgage Loan per $1,000 Age 18-30 41-45 56-60

Life $1.35 $4.00 $7.50

Disability $3.10 $3.30 $17.00

Unemployment $3.00 $3.00 $3.00

TOTAL $ 7.45 per $1,000 $10.30 per $1,000 $27.50 per $1,000

Premium Variations: Smoker = + 100% on Life, Joint = + 50% on Life.

Premiums can be paid monthly with say 10% loading.

Unemployment not available by itself and max period of 6 mths.

NOTE: The above rates are only for House Mortgage loans. We do not have any rates on other loans such as MV Loans however we suspect the rates are around 5 x greater.

Excess Situation

General

7 to 14 days Static / fixed location only

Mobile

No

Yes

Best Practices: 9 Not a frequently acquired policy.

9 Often promoted and sold by the financier.

9 The policy is not “value for money” – consider a “Disability” policy

Trivia

Loss of Profits -

See "Consequential Loss" (see listing).

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Marine Hull – Pleasure craft To provide cover for nominated Vessel.

Purpose

The cover is extremely broad:Section 1. Physical Accidental Loss &/or Damage including any accessories (if listed and attached thereto at the time of loss).

Section 2. Third Party Legal Liability (also known as “P&I” (Protection and Indemnity) resulting from physical contact on or by the Vessel and/or its contents.

Policy Divisions Settlement Level of cover Rating factors

Asset only Asset and/or Liability Liability only Yes Yes No Replacement New for Old Indemnity (market Value) No Yes “Gold” – (broadest cover) “Silver” (defined events) “Bronze” (restricted) Ye No No Size, location, make, construction, engine size, max speed, trailered or moored, Sum insured, if used in competitions, claims history Approximate rates subject to age, location make, model etc., Sum Insured Under $20,000

Premium

rate 2.0%

premium $400

Sum Insured over $40,000 over $70,000

rate 1.5% 1.0%

Premium $600 $700

The above rates include 3rd party Liability. minimum premium $250 plus Jet Skies have approx 50% loading.

Skier’s Liability approx $50, Domestic Racing events approx 10% Loading.

Excess Situation

General

Generally $250 then 1% over $500 Static / fixed location only Mobile No Yes Best Practices: 9 Accessories must be named and be attached at the time of a loss 9 You can include Accessories and personal contents, provided they are listed 9 Some insurers cover sporting equipment, but not when in use 9 Most policies limit burglary to violent/forcible means - only a few cover Theft or Pilferage.

9 Note: Speed boats are a little difficult to insure. Critical factors are Age, Motor Type and if inboard or outboard.

Be cautioned … there is a separate an independent “statute of law” that governs the “Marine” risks, known as “MIA (Marine Insurance Act) however “Pleasure craft” and other “domestic” Marine risks continue to be governed under the traditional “ICA” (Insurance Contracts Act”) - it makes a big difference to your protection.

Level of cover is like a motor vehicle policy the cover is “Gold” within the Geographical limits of the policy.

Accessories: Only those items forming part of the boat can be insured. Such items would be echo sounder, 2-way radio, safety equip. Household contents like TV, Microwave & furniture can also be covered provided they are listed. Some insurers also provide a section for "Personal effects" with a sublimit per item. Note that all sporting and recreational items can not be included so you need to extend your home policy for this.

Trivia

Liability from the trailer is also included when not being towed (when towed the liability falls under the risk of the vehicle).

Conversion rate for Marine speeds. Fathom = 6ft or 1.8 mtrs Miles Knots Kms Knots .80 1 1.25 .480 1 2.08

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Marine Hull - Commercial To provide cover for nominated Vessel.

Purpose

Policy Divisions Settlement Level of cover

The cover is extremely broad:Section 1. Physical Accidental Loss &/or Damage including any accessories (if listed and attached thereto at the time of loss).

Section 2. Third Party Legal Liability (also known as “P&I” (Protection and Indemnity) resulting from physical contact on or by the Vessel and/or its contents.

Asset only Yes Replacement New for Old No “Gold” – (broadest cover)

Asset and/or Liability Liability only Yes No Indemnity (market Value) Yes “Silver” (defined events) “Bronze” (restricted)

Ye

No

No

Rating factors

Activity/Use, Sum insured on Hull/Machinery/Accessories, Geographical limits, No of Passengers, Max Speed, Hospitality services provided (food/drink etc.,) Claims History

Premium

Similar structure to Pleasure craft rates but around 25% higher on average.

Excess

Usually 1% of sum insured with $500 minimum.

Situation

Static / fixed location only

Mobile

No

Yes

There is a separate and independent act governing “Marine” risks known as “MIA” ("Marine Insurance Act"). This International law has many features different and unique from the local “ICA” (Insurance Contracts Act) we have listed some examples at the bottom of this section hereunder.

Whilst there are two sections, similar to pleasure craft, ie., section 1] Own Damage and section 2] 3rd Party Liability (known as P&I = Protection and Indemnity) HOWEVER the provisions of cover, terms etc., are very different.

This is the same principle as Consumer cover verses Business covers. With business cover there are no extras included so you must identify with the benefits and extensions required. For example:Accessories. Must be listed. Some insurers will cover sporting and/or recreational items however the cover is usually restricted to Fire, Burglary &/or total Loss of vessel.

General

Machinery damage. It covers sudden and/or unforeseen damage to machinery by latent defects as well as negligent damage by repairers. This cover is already included under "Time clauses" but must be extended under "Yacht clauses". Rates vary according to age of machinery etc., Average loading say 10 to 20% Loss of earnings. If the boat being out of use as a result of a claim under the boat policy. This cover would be arranged under a separate policy. Example:- Sum insured of $90,000 being $500 per day over 180 days with 14 day excess would be a rate of around 3.5% Liability or Protection & Indemnity. Covering loss/damage demand by 3rd parties. It's important to note the Liability is attached to the hull and therefore only covers events caused known activities/use of the boat. If you have a charter service or guide service then you also need a separate Public Liability policy to cover events not directly arising from the hull ie., your instructions or direction to the customer or activities when not actually on the boat..

Further extensions to Liability may be:-

Passenger Liability, Food and Drink Liability.

Best Practices: 9 As listed above 9 Consider additional Liability cover for Hull and passengers through a P&I club. This becomes critical depending on the number of passengers and the location of operation ie., difficult waters or distance to safety.

Trivia Some examples and references to distinguish the difference in cover from Commercial and Pleasure craft A contract of Marine Insurance is where an insurer undertakes to indemnify (protect) the assured, in a manner and extent agreed, against marine losses, that is, losses incidental to a "Marine Adventure". Such contracts usually include inland DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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waters and land risk incidental to any sea voyage. It should be noted that whilst a land risk only may be handled by a marine dept., it does not fall under the "Marine Insurance Act. A short version of "Marine Adventure" definition of section 9(2):- Any Ship, goods or moveables exposed to maritime perils shall be insurable property.

- the earning or acquisition of any freight, passage money, commission or other pecuniary benefit, or the security etc., is endangered by the exposure of insurable property to maritime perils.

- any Liability to 3rd parties may be incurred by the owner or persons interested in or responsible for, insurable property, by reason or maritime perils.

A short version of "Maritime Perils" definition of section 9:Perils consequent on, or incidental to, the navigation of the sea, that is, perils of the seas, fire, war perils, pirates, rovers, captures, restraints, jettisons, barratry etc., or as designated by the nominated insurers policy.

Points of Interest:Total Loss - Actual and Constructive= There is an actual total loss where the subject matter insured is destroyed or it is so damaged as to cease to be an item it was before the event or where cost of salvage outweighs sum of cover.

Particular Average=Partial Loss. The measure of indemnity is the cost of repairs less improvement resulting there from such where betterment exists, for instance, by the use of new material to replace old (refer section 69). The insurer has the right to apply "betterment" clauses but not common.

Sue & Labour=Expenses incurred by the insured with the view of averting or minimising loss recoverable under the policy.

The insured has the right under section 84(1). Furthermore section 84(4) states that the insured has an duty to avert or minimise a loss.

General Average=Applies whether or not the parties to a marine adventure are insured. It refers to loss or damage intentionally caused to save the whole adventure from an impending peril. The resulting loss is shared proportionately by all parties to the adventure whether insured or not.

Liability=Under Marine policies it is classified and known as "Protection and Indemnity". This description dates back to the early days "Lloyds" and is still used today as are many "instituted" words and policy clauses.

Level of cover is like a motor vehicle policy the cover is â&#x20AC;&#x153;Goldâ&#x20AC;? within the Geographical limits of the policy.

Conversion rate for Marine speeds

Miles .80

1

Knots 1.25

Klms .480

1

Knots 2.08

Conversion of depth Fathom = 6ft or 1.8 mtrs

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Marine Transit – Cargo To cover material items during a voyage by Sea / Air, Road; road or rail CARGO COVER GENERAL INTRODUCTION – please read There are three (3) separate and different policies available. This is only a quick summary comparison to guide to you the correct type - each is listed in more detail hereunder:1) Marine transit/Cargo. More commonly know as Marine Transit. This policy type is used by the Buyer/Seller/Owner of goods to protect the subject goods whilst on an actual journey, (referred to as Adventure). Within this policy there are several different levels of covers available.

2) Marine Transit/Cargo – Carriers. When the carrier wishes to cover the goods on behalf of the customer. Cover is generally limited to defined events (FFCO). It covers certain events but NOT all matters that you may be legally liable for. See examples below:-

Purpose

3) Liability - Carriers. Another option available for the Carrier. It protects the carrier for their Legal Liability only and can only be purchased if consignment note is used. Some insurers have an option to include Carriers Cargo under Carriers Liability – obvious a better policy but at a cost.

IMPORTANT:- The carrier has a choice of 2 policy types and you MUST point out both as they have gains and pains. Example:1. Carriers Cargo – covers defined events (FFCO (see above)). This covers such events as damaged to cargo from 3rd party car running into the truck and goods, or you colliding into a tree, however it will not cover goods falling of the truck because they were not properly secured. Caution the cover may not include clean up costs 2. Liability Carriers covers loss due to your Legal Liability (your negligence). It would cover goods falling if you did not secure them properly, however it would not cover damage to cargo caused by a 3rd party because that was not your negligence.

General

Trivia

Obviously the decision comes down to cost to you in premium versus cost in goodwill to customer and your legal obligations.

Best Practices: 9 Need to discuss and understand the different covers – they provide different “levels’ (quality) of cover but at a price. Cover versus budget constraints.

9 Consider the goodwill to clients if you do/do not have cover 9 Consider the inconvenience of legal action if you do not have a liability policy 9 Consider the clean up costs associated with the type of cargo, some cargo policies include others do not. Some truck policies cover this and some do not.

Use the hyperlinks above to the different types of cover to access the “trivia” sections to learn more about each item such as “common/normal” carrier.

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Marine transit/Cargo For the Buyer/Seller/Owner, to cover an item during a Voyage (Imports, Exports, Inland Sendings; Interstate or intrastate (within the state)).

There are Three (3) types of policies:1) Individual or "one off" (a single shipment) of known items.

2) Annual policy for regular shipments of known items.

The premium is calculated on annual estimate of cargo value then adjusted by declaration. The declarations are submitted either by month, quarter or annual as mutually agreed. The policy usually carries a non refundable deposit clause of 80% of the estimate premium.

The premium is payable either monthly, quarter or annual, as mutually agreed.

Annual policies require a limit per voyage (this is subject to under insurance clauses) 3) Open policy, same as annual policy however allows for variety of items.

Four (4) basic types of cover:- Institute Cargo Clauses "A", "B", "C", "FFCO".

Purpose

“Gold” (ICC “A") =All Risks" of physical loss or damage, unless otherwise excluded, in the normal course of transit. Note: Electrical derangement is not covered unless evidence of Physical external damage. Standard exclusions such as Inherent Vice, Shrinkage, Defects, Unseaworthiness, Unsuitable packing, Cons Loss etc., “Silver” (ICC “B") = Sea Transit: Defined events, such as:Fire or Explosion, Vessel stranded or sinking, Collision, Discharge of Cargo at port of distress, Earthquake, Washing overboard, Jettison, Total loss of cargo whilst loading/unloading from vessel.

“Silver” (ICC “B") = Road or Rail Transit: Defined events such as:- Fire or Explosion, Overturning or Derailment, Collision, Earthquake.

“Bronze” (ICC “C”) = Sea Transit: Defined events, such as:- Fire or Explosion, Vessel stranded or sinking, Collision, Jettison, Discharge of Cargo at port of distress.

“Bronze” (ICC “C") = Road or Rail Transit: Defined events such as:- Fire or Explosion, Overturning or Derailment, Collision.

Extension: EQUIPMENT & TOOLS OF TRADE. If you have equipment on Demo or carry equipment for own use.

Policy Divisions Settlement Level of cover Rating factors

Premium

Excess Situation General Trivia

Asset only Asset and/or Liability Liability only Yes No No Replacement New for Old Indemnity (market Value) Generally No Yes “Gold” – (broadest cover) “Silver” (defined events) “Bronze” (restricted) Optional Optional Optional Type of Cargo, Mode of Transport, Packaging and by who, If Full container or shared, Voyage; from to including pick-up and delivery point ie., From Warehouse/ship to ..., Type of cover, extensions of cover, Sum Insured and limit per voyage if annual policy.

Premium: Minimum of $180 for "One off" risks and $250 for annual policies. Whilst rates vary an average would be around $2. per $1,000. Higher hazards may by 50%/100% more.

Sample of rates based on general (non hazardous) goods:S/INSRD PREMIUM S/INSURED PREMIUM S/INSURED PREMIUM $ 20,000 = Min Prem $ 50,000 = Min Prem $ 100,000 = $ 200 $250,000 = $500 $500,000 = $900 $1,000,000 = $1500 Excess: Usually $100. Some risks attract a "Franchise" excess. (if the loss exceeds the excess the insurer will waive the excess, usually applied to cargo that has many units and breakages are predictable ie., cartons of wine).

Static / fixed location only Mobile Depends on the policy Depends on the policy Best Practices: 9 See notes below Various as listed hereunder

Marine Transit – Cargo cover Common Extensions: Wars and Strikes, Riots and Civil commotions, Loading and Unloading, Theft Pilferage and Non Delivery.

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Average means: PA= Particular Average - a partial loss of cargo. FPA = Free of Particular Average - a Total loss. GA = General Average and act or sacrifice act to save ship and cargo. - (Explained in detail under "Marine Hull & Liability" (see listing).

Terms: CIF= Cost, Insure, Freight. FOB = Free on Board. C&F = Cost & Freight. Ex Warehouse = Ex Works. FAS = Free alongside ship. DEQ = Delivered to Quay.

Other: ROD= Excluding Rust Oxidisation &/or Discolouration

CRITICAL ISSUES: When does cover apply Only when the voyage/Journey for the goods actually begins and ends. This means when goods have (not being) loaded onto the conveying vessel/vehicle. You need to consider extension for "Loading and Unloading" and this only covers the actual lift and not movement within your premises so consider an "Accidental Damage" policy.

Standard ICC clauses include 30 days storage cover incidental to the voyage. ie., if the goods had to be left in storage, between carriers in changeover. This does not mean storing until you decide where to go next although special arrangements may be made.

Demarcation point â&#x20AC;&#x201C; who is liable at what point of the journey Must clarify the demarcation point (when goods were undamaged at stages of journey and where your responsibility finishes).

Identify pick-up and Delivery point ie., if overseas is inland transit also required ?

Packaging "Packaged normal to trade" implies by/with Professional standards. If personal goods it must be packed by a Professional to get cover ICC A. What sum insured When estimating the sum insured consider your net invoice costs (not profit) and other such as Freight and other charges as you would need to incur these again if you restart the voyage.

These costs are referred to as "CIF" (Costs of Invoice and Freight).

"CIF" conditions are applied when the goods are insured by the seller and this can be a dis-advantage to the purchaser. It means you have to claim from the seller's insurer which can be complicated if importing from overseas. You have no control over the policy - you have no knowledge of the ability of the insurer and their place of settlement.

You must nominate a limit per voyage - ensure this is not below your maximum as under-insurance clauses will apply.

Cost of a policy Annual policies always have a cheaper rate than individual policies due to saving on administration for the insurer.

The higher the annual shipments the lower the annual rate, however there is a minimum not refundable deposit premium so one should not over estimate unduly.

Removal of Debris - most cargo policies include a sub-limit of around $5,000 for the clean up/removal of debris.

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Marine transit/cargo - Carriers For the Carrier. To cover an item during a Voyage - Imports, Exports, Inland Sendings; Interstate or intrastate (within the state).

Similar to "Cargo cover" . Where the Carrier has elected to take out a policy on behalf of the customer/s.

The decision to do so by the carrier may be as a result of the terms of haulage or simply for customer goodwill!

Purpose

You select the level of cover you require, however it is usually restricted to "FFCO" (Fire, Flood, Collision of overturning Vehicle) plus extensions, such as:T,P & ND = Theft, Pilferage & Non-Delivery, L & U = Loading & Unloading, Impact of Load.

Carriers should have a Carriers Liability policy. This covers your legal Liability as opposed to your goodwill. Some insurers can offer a combination of the 2 policies.

Policy Divisions Settlement Level of cover Rating factors

Premium

Asset only

Asset and/or Liability

Yes Replacement New for Old

No

Generally No

Liability only

No Indemnity (market Value) Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Type of Cargo (see categories under Carriers Liability, GFE (GFE = Gross Freight Earnings), Limit per voyage, type of cover and extensions required.

Minimum for "One Off's" (single event policy) is $150 and annual say $300 otherwise rates vary according to rating factors. Example of premium structure:Say “G.F.E” = $100,000 Extensions

General rate for FFCO cover T,P & N D L & Unloading

= .350 = $350 = .10 = $100 = .30 = $300

Rates would be higher if more hazard (say .50), similar to rate variation under Liability - Carriers.

Excess Situation

General

Trivia

Usually around $250.

Static / fixed location only

Mobile

No

Yes

Best Practices: 9 This type of policy covers named perils. The alternative is to consider a “carriers Liability” policy however that will only respond to loss where you are negligent. The named perils policy would provide a better level of customer goodwill.

The value of the cargo is often not known to the carrier so the only available sliding ruler for rates is on the carriers GFE. Cover ICC "B" for Road & Rail - Collision does not include contact with Kerbs, road or allied areas.

Falling cargo not covered unless by a defined event. You can also use "Liability - Carriers" policy (see listing).

For explanation of the difference between Carriers Cargo and Carriers Liability refer to the listing on Marine Cargo

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Money To cover Burglary of “negotiable securities”.

"Money" usually means Cash, coins Stamps, Cheques (excluding non negotiable), negotiable vouchers/securities but not consequential loss/damage.

Purpose

Policy Divisions Settlement Level of cover

There are several sections of cover available for selection:At work During Business Hours In Transit to from Bank or Home At Home/authorized residence or insured or employee/s In Locked safe on premises outside business hours.

You can also purchase an option to cover increase limit during bank holidays.

Asset only Asset and/or Liability Liability only Yes No No Replacement New for Old Indemnity (market Value) Yes

Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Rating factors

Industry, Sum Insured, sections of cover required, claims history

Premium

Minimum premium $150. Rate approx 1% per section

Excess

Usually around $250.

Situation

General

Trivia

Static / fixed location only

Mobile

No

Yes

Best Practices: 9 Rates much lower as a package policy – see “Business Pak”.

9 Consider the cost of replacement (see comment under trivia below) 9 Most businesses only address cover for the 3 basic sections:- during work, in transit and at home.

This usually costs around 3.5% 9 Cover ceases on at the close of the next bank trading day. Ie., Friday and Saturday takings are covered until Monday afternoon so you must consider:9 Using a safe, taking money home or daily bank deposits.

What is a “replacement value” • Indemnity is “replacement”, the insurer will not replace “not negotiable cheques”, and they will contact the drawer and request another so consider this in your sum insured.

• Cover ceases after certain banking timeframes – see comment under “best practices”

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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MATERIAL LOSS AND/OR DAMAGE This is, as the title suggests, a very broad form of cover. It includes the usual defined events of “Fire and extraneous Perils” , ”Accidental damage” and ”Burglary”. Transit cover is additional option.

This type of wording is offered in only a few policies a. b. c. d. e.

I.S.R. (Industrial Special Risk) for Large Commercial Asset values over $2,000,000 Office Packs Some restricted form in Business Packs Motor Vehicle Boats – Marine Hull

Why is this cover better - … it forces the insurer to list exclusions otherwise everything is covered.

A standard BPK policy / section only covers events defined whereas this type of wording covers any loss unless otherwise listed as an exclusion.

The Policy Divisions, Settlement, Level of cover, are subject of each policy as listed, as is the Premium and Excess

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Motor Cycle

Purpose

To cover Physical Loss or Damage to the Vehicle including the Liability caused by its’ physical contact.

Policy Divisions

Asset only Yes Replacement New for Old

Settlement Level of cover Rating factors

Premium

Asset and/or Liability Liability only Yes Yes Indemnity (market Value)

Generally No

Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

Yes

Optional

Optional

Occupation of primary driver, Youngest age of known drivers, Vehicle Make & Model, P/Code where kept, Use of Vehicle, NCB, If Financed, If approved alarm, S/Insured Premium: Minimum $100 and varied according to rating factors. Example:Prem for Prem for Prem for Sum Engine Open Engine Open Engine Open Insured CC Driver CC Driver CC Driver 1000 100 $200 250 $ 370 500+ $ 380 5000 100 $400 250 $ 950 500+ $1300 10000 100 $700 250 $1900 500+ $2100 Restricted Driver = 10% discount Max NCB = 20% Courier Bikes + 50%

Excess Situation

$200 small bike to $500 for large Static / fixed location only

Mobile

No

Yes

Definition/ratable use:- - similar to Motor Vehicle - standard General

Best Practices: 9 Accessories not covered unless listed 9 All undeclared drivers covered subject to retrospective underwriting guidelines

Trivia

We have an extensive List of FAQ’s available on request.

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Motor Vehicle – standard (<1 tonne) To provide cover for nominated Vehicle/s.

Purpose

Policy Divisions Settlement Level of cover Rating factors

The cover is extremely broad:Section 1. Physical Accidental Loss &/or Damage including any accessories (if listed and attached thereto at the time of loss).

Section 2. Third Party Legal Liability (also known as “Road Risk Liability”) resulting from physical contact on or by the vehicle and/or its contents.

Asset only Asset and/or Liability Liability only No Yes Yes Replacement New for Old Indemnity (market Value) Generally No. sometimes if 1year old.

Yes “Gold” – (broadest cover) “Silver” (defined events) “Bronze” (restricted) Yes No No Intended primary use of Vehicle, Occupation of Primary driver, Age of Youngest known driver, Vehicle Make & Model, Sum Insured, P/Code where kept, NCB, If Financed, If approved alarm, claims history Minimum premium $200. The following prices are basic with no discount/loading:Sum Insured $ 5,000 $20,000

Premium

Excess Situation

General

Trivia

Rate 12.00% 06.00%

Sum Insured $10,000 $40,000

Rates need to be discounted/loaded for: 1] No Claims Bonus discount – up to 60% 2] Tradesman use reduce by 10% 5] NCB protector add $20 to $40

Rate 08.50% 05.00%

Sum Insured $15,000 $60,000

Rate 06.00% 04.00%

2] Business use add 30% 4] Under 25 load 20% to 50% from age 17 to 25 6] Free windscreen claim $20 to $50

Example: 2001 Holden Commodore Executive Sum Insured: $ 20,000 (market value) No Claim Bonus: 60% (including protection) Finance: No Age of Driver: 31 Suburb: South Perth Use: Private Average Premium: $ 660.00 Minimum $200 / 1% of sum insured over $50,000 + underage excess of $250 to $750 from 21 to 25.

Some insurers charge undeclared driver excess from $500 Static / fixed location only Mobile No Yes Definition/rateable use:9 "Private" = Private, pleasure & social including work provided you are not a Commercial Traveler, Real Estate or that which requires the use of the vehicle as a primary purpose for deriving income.

9 "Business" - All the above including Business use. Essentially a Business use vehicle is one used in a Commercial sense or forming a critical &/or primary source of income.

Best Practices: 9 Non standard extras (accessories) not covered unless listed.

9 Modifications may prejudice your cover.

9 Review any restrictive cover options applied 9 Undisclosed Drivers, their licence convictions and claims can prejudice your claim entitlement.

9 Value to insure is based on “current Private sale” value.

9 Hire car option auto included by most insurers but restricted to Theft only. Some insurers have option for Hire car from an Accident approx cost $100 (few clients consider because it has restrictive conditions) 9 All undeclared drivers covered subject to retrospective underwriting guidelines. Most insurers also impose an unnamed driver excess which is additional to an under age excess.

9 Options for NCB Protector and Windscreen concession should be considered If the Vehicle is "Prestige" and/or over $50,000 we can place on a special Restricted driver policy for around 30% reduction on rates.

WA registered vehicles rd 3 Party Liability – (better to be known as “road risk liability) is usually automatically included. This only covers property damage and in WA also “S.B.I.” “Supplementary Bodily Injury” or Gap cover.

9 Damage caused by items attached to or falling from the vehicle is included (but not damage to the item).

9 Bodily injury, in WA, is compulsory insurance attached to the vehicle registration.

9 9

Trailer titles – see MV Commercial Trailers Territorial limit includes anywhere in Australia including Transportation.

9

We have an extensive list of FAQ’s available on request, this covers o

What is: an NCB?, Named driver?, Indemnity Type?, restricted driver?, undeclared driver excess?, windscreen options, etc.,

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Motor Vehicle – Fleet Same as Motor Vehicle policy with the convenience of placing all on one (1) schedule.

In most instances there is a significant saving in premium as well as the option of Commercial negotiation of a variety of extensions tailored to suit the client

Purpose

ACCESSORIES CLAUSE TO $ AUTHORSHIP BREACH OF CONDITIONS WAIVER CLAUSE CAR SHARING ARRANGEMENTS COSTS OF HIRING CANCELLATION CLAUSE DEFINITION OF MOTOR VEHICLE DANGEROUS GOODS GOODS CARRIED (LIABILITY) CLAUSE INDEMNITY OF INSURED/EMPLOYEES LOSS OR DAMAGE MARINE GENERAL AVERAGE OTHER INTERESTS RELEASE CLAUSE RENTAL AGREEMENT CLAUSE SIGNWRITING COSTS PER VEHICLE TO $ TOTAL LOSS TRAILERS TO VALUE $500 OR

ACCIDENTAL BODILY INJURY LIABILITY AUTOMATIC INCLUSION LIMITED TO $ CAR PARK CLAUSE CONTRACTUAL LIABILITY CLAUSE CROSS LIABILITY CLAUSE DELIVERY FOLLOWING THEFT OR REPAIR DRIVERS & PASSENGERS INDEMNITY EXPEDITING EXPENSES HIRED OR LEASED VEHICLES LIABILITY OF PASSENGERS LP GAS CLAUSE MODIFICATIONS PRINCIPAL'S INDEMNITY RECOVERY COSTS REPATRIATION COSTS SUE AND LABOUR CLAUSE TOTAL LOSS OF LEASED VEHICLE

Premiums:

generally 20% lower than Motor Vehicle policy unless extensions added.

Excess:

Same as Motor Vehicle - standard

Qualifying factors:

Minimum of 5 vehicles, otherwise same as Motor Vehicle - standard

Best Practices: 9 Price is important however the primary attention to Fleet is to ensure all Vehicles are covered with appropriate extensions of cover the intended use of vehicle and Industry of the Client. The insured does not have the same level of control of many vehicles and drivers as you would your own car so “what if” scenarios need to be considered.

9 Refer to Motor Vehicle – standard.

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Motor Vehicle â&#x20AC;&#x201C; Luxury / Prestige A conventional Motor Vehicle policy but designated for a target market

Purpose

Target market 9 Vehicles with Sum insured over $40,000 9 Prestige classification, within recognition of being a High powered 9 Restricted drivers (generally no one under 30) 9 Must have anti theft device and security parking

Premium:

Generally around 30% to 50% lower than the standard motor vehicle rates.

Excess:

Generally 1% of sum insured with minimum of $500

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Motor Vehicle – Commercial / cartage

Purpose

Standard Motor Vehicle policy, cover both the asset and Liability physically caused by the vehicle.

Policy Divisions

Asset only Yes Replacement New for Old

Settlement Level of cover Rating factors

Premium

Excess Situation

General

Asset and/or Liability Liability only Yes Generally No Indemnity (market Value)

No

Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

Yes

Optional

No

Base, Radius of Operation, Cargo carried (general/frozen/earthworks), Carry capacity, Any No claim Bonus, Age of Driver and experience Minimum premium $150 and variable as follows:2-5 tonne say 50% of MV rates 5-8 tonnes say same as MV rates Over 8 tonne Rigid body on short haul approx 3% Over 8 tonne Articulated (prime mover) from 5% for short haul to 10% for long Haul ie., North West and Australia wide.

Usually Rigid Body = 1% of sum insured and Articulated = 2%. Once you get over 08 Tones ne the minimum excess is around $500 Static / fixed location only Mobile No

Yes

Best Practices 9 Accessories and/or tools are not covered unless listed. It's better to cover you tools under "General Property" to protect your No Claim Bonus + the truck excess may be too high. rd 9 3 Party Liability includes:o Includes "GAP" cover - Bodily injury not covered by compulsory licence insurance o Hazardous Goods" - When carrying hazardous goods, as defined.

"Packaged" any item in a container being any amount less then "BULK".

"Bulk" as defined below, this requires special licence for the vehicle and the driver rd 9 3 Party Liability Excludes:o "Non owned Trailer" Liability - If you pull someone's trailer and it is damaged the owner or their Insurer can recover against you in an action of "Strict" Liability. As you are the Bailee in control of the trailer you owe a special duty of care. (If you use the same trailer it may be easier to insure it rather then taking this extension). Note - some insurers provide Liability only, some offer composite (Asset cover and Liability). o Cargo - No covered, you need a separate dedicated Cargo or Carriers Liability policy.

9 Public Liability policy. Separate policy required for all other aspects of the business (This would also need to be amended if you handle "Hazardous Goods").

Tare = Net weight of vehicle without any load Gross = Combined weight of vehicle and maximum load.

The difference between Tare and Gross being the carrying capacity GCM = Gross carry mass - this is the max carry including trailered load.

Trivia

Rigid body – Cab Chassis with fixed carry tray.

Articulated – Cab chassis – 1 or more trailers detachable "Bogie" = 2 Drive Transmission. Trailer titles – see MV Trailer titles More, as listed below

TRANSPORT IN BULK means, in relation to the transport of Dangerous goods, the transport of or to transport; [a] Dangerous gases in a single container having a capacity exceeding 500 litres. [b] Dangerous goods other than dangerous gases in the form of liquid or paste, in a container having a capacity exceeding 450 litres. [c] Dangerous goods in the form of solids in a container in an undivided quantity exceeding 400 kilograms.

DANGEROUS GOODS means the substances and items classified as dangerous goods under Section 2 and listed in Subsections 9.4, 9.5, 9.6 and Table 10.4 of the Australia Code for the Transport of Dangerous Goods by Road or Rail.

Premium for "Bulk" hazardous goods limit of $2,500,000 is around $650 to $850 Most policies include a sub-limit under the Liability section, usually around $100,000 to $200,000, for "Packaged" Hazardous goods, provided statutory practices are applied. "Bulk" require a minimum of $2,500,000 sub-limit as well as a special licence on the vehicle and the driver.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Motor Vehicle – Commercial Trailer

Purpose

Standard Motor Vehicle policy, cover both the asset and Liability, with special rates for Trailers.

Policy Divisions

Asset only Yes Replacement New for Old

Settlement Level of cover

Asset and/or Liability Liability only Yes Generally No Indemnity (market Value)

No

Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

Yes

Yes

No

Rating factors

Rating factors: Same as "Cartage Vehicle".

Premium

Minimum $110. Rates .approx 2.5% to 5% depending if trailer is small or large and if local haul or long haul.

Excess

Usually 1% of sum insured with minimum of $150

Situation

Static / fixed location only

Mobile

No

Yes

Commercial Trailers generally can not be insured independently as the insurer has no knowledge of the operators pulling the trailer.

General Liability issues – see “best Practices” issues listed under MV Commercial

Trivia

Trailer titles "Pig" = Rigid fittings/coupling.

"Dog" = Turntable.

"Dolley" = Independent turntable to attach a 2nd trailer to the rear of the 1st Trailer.

"Tri-axle" = 3 axles.

"B-Double" = 2 trailers which are 1/2 way between a single trailer and two trailers (road train) in length.

“Pig Trailer” a second tipping trailer “Semi" = Single Trailer.

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Mortgagee Protection This may be miss-interpreted!

Purpose

It may mean "Loan Insurance" (see listing) to protect the loan in the event of Injury or unemployment.

OR It may mean "Mortgagee Insurance" (see listing) to protect the mortgagee (lender) when loan ratio is very high.

OR It may mean "Strata Mortgagee Protection or Interest (see listing) when the mortgage is on a strata property.

Or It may mean “Innocent Mortgagee Protection” which is a special policy to cover Lenders for security of risks covered by the “M.I.A.” (Maine Insurance Act”

MORTGAGEE INSURANCE This is usually a special cover required by the Mortgagee (the lender) when the loan ratio is quite high. The policy guarantees the lender full satisfaction of the loan should the property be sold by action of the lender. This type of policy is only available from a few insurers which are pre-approved by the lender and are therefore otherwise arranged.

In some instances the lender may only require "Loan Insurance" (see listing) which covers the customers against Accident, Death and Unemployment.

See also Mortgagee Protection for listing of other similar title risks We are not likely to have facilities for this product.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Multirisks – Domestic Usually reserved for Personal Valuables - Jewellery and items generally of Personal use or being worn.

It has the same characteristics of cover as the “Multirisk”, or “All risk” section of a Home pak policy.

Purpose

Territorial limit is usually anywhere in Australia and/or NZ, some insurers allow world wide.

Policy Divisions Settlement Level of cover Asset only

Rating factors

Replacement New for Old

“Gold” – (broadest cover)

Item insured, Sum Insured, Security, Location, claims history Minimum $200. Rates .approx 4% diminishing on larger sum insured over $50,000

Premium

General

Trivia

Excess

Situation

Usually $100

Mobile

Best Practices 9 Lower rates can be acquired if included in the package policy – see Home pak.

9 Rates can become expensive,. Under a Homepak policy there is an option to take “Unspecified” Mulitrisks which offers “blanket” cover – see Trivia below. Otherwise take out a “Luxury homepak” which auto includes Multirisk cover on all contents COVER: "Physical Loss and/or Damage" which covers pretty well any type of loss other than some of the obvious such as Wear and Tear, Sports items whilst in use, Inherent Vice, Lack of Care by the insured.

There are two (2) categories of cover: "Specified" items and "Unspecified" items or "Blanket" cover.

The specified is somewhat obvious and Unspecified provides a floating limit of say $1,000 per item but say $3,000 in total and this then covers all the small items. Rates for both sections are round $40.00 per $1,000 Excess is usually $100 Although the maximum limit may not suit you have more items covered.

Commercial cover of similar cover is known as “Material Loss and/or Damage”

PHYSICAL LOSS AND/OR DAMAGE

Same as "Material Loss and/or Damage" (see listing).

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Pluvious To cover loss of success or continuation resulting from “RAIN”.

Ideally suited for hospitality/entertainment events.

Purpose

Cover is usually limited the Direct loss/expenses and not consequential loss of income, however some insurers provide some variation.

Policy Divisions Settlement Level of cover Asset only

Rating factors

Indemnity (market Value)

“Silver” (defined events)

Event, Location, Protection, Time, Date, Duration and Sum Insured.

Minimum $650 with average rate around 3% which varies depending on the above rating factors.

Premium

General

Excess

Situation

Usually an agreed rain fall reading.

Fixed / static location

Best Practices 9 No volume of dealings to provide list of “best Practices”.

Trivia

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Political Risk To provide an agreed Limit to address special events such as Kidnap, Ransom, Extortion, Bombing, War Risk, Personal Injury or Property.

As you company expands globally, so do your exposures. Companies with overseas operations and executives or staff who travel internationally may be targets for kidnappers and extortionists.

Purpose

Rating factors

Example of cover: 9 Ransom and extortion payments, Loss of payment whilst be delivered, Expenses coverage as a result therein, Liability as a result of retrieval, Political threat (wrongful detainment when acting under a govt., instruction), Rehab costs, Disability cover (accident/death).

Policy Divisions Settlement Level of cover Asset only Indemnity (market Value) “Silver” (defined events) Event, Location, Protection, Time, Date, Duration and Sum Insured.

Minimum $650 rates vary depending on the rating factors.

Premium

Excess

Situation

$100

Mobile

General

Best Practices 9 Lower rates can be acquired if included in a package policy – see Corporate Travel

Trivia

The policy will include Emergency Evacuation expenses

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Patent Protection To provide cover for Legal fees necessary to protect a patent design.

Purpose Rating factors

Policy Divisions

Settlement

Level of cover

Asset only

Indemnity (market Value)

“Silver” (defined events)

Item insured, Sum Insured, Patent confirmation, Location/Territorial zones required, claims history Minimum $750. with sum insured of $20,000

Premium

General

Excess

Situation

Usually $100

Not applicable – Territorial limit only

Best Practices 9 Lower rates can be acquired if included in a package policy – see Legalexpense – Commercial 9 Don’t forget you do have a patent design which means some statutory level of protection.

Trivia

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Personal Accident and Illness The policy is designed to “Protect an Individual’s Income”, there are several other policies that do the same thing but with different titles:Disability, Income Protection, Personal Accident and Illness, Group PA, Salary Continuance “Disability – same product – see this section for more product detail including costs.

Purpose Income Protection – same but with an option to guarantee a renewal invitation – useful if poor claims history but there is a cost for the option.

Group PA – Same as Disability but 1 policy with many people on 1 policy,

Policy Divisions Settlement Level of cover

Salary Continuance – Same as Group PA but designed to cover non work activities.

Asset only Asset and/or Liability Liability only Yes Replacement New for Old No

No Indemnity (market Value) Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Rating factors

See Disability listing

Premium

See Disability listing

Excess

See Disability listing

Situation

No

Static / fixed location only

Mobile

No

Yes

General

Best Practices 9 View the “Disability” check list page – it is in broader detail.

Trivia

Listed under Disability

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Package policy “Office Pak”

Purpose

A single policy covering a variety of popular / common risks for the average business

General

Best Practices 9 Most Insurers promoting a special Dedicated policy for this risk will include several additional features not available under a standard “package Policy”. These include:a. Full Material Loss & Damage wording b. Lower rates for obvious exposures such as Mobile Electronic equipment cover c. Higher limits on artwork 9 “We have summarised the information 1 section – see “Business pak” 9 The premium payable under this Package would be approx 30% lower than a standard Business Pak policy 9 On our website under link to Products see “O/I.R.I” it offers some price indicators for this Risk.

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Salary Continuance Plan The policy is designed to “Protect an Individual’s Income”, there are several other policies that do the same thing but with different titles:Disability, Income Protection, Personal Accident/Illness, Voluntary Group PA, Salary Continuance “Disability – same product – see this section for more product detail including costs.

Income Protection – same but with an option to guarantee a renewal invitation – useful if poor claims history but there is a cost for the option.

Voluntary Group PA, - Same as Disability but 1 policy with non rewarded people on 1 policy, Salary Continuance – Same as Group PA but designed to cover non work activities.

Salary Continuance:- - Basically the same product as “Disability Insurance” however it is essentially designed to provide cover for “Non work events”.

Purpose

A quick comparison between the two products Scope of cover – generally - Accident & Lump Sum (Capital) Scope of cover – generally - Illness Territorial limit - generally Typical / standard Excess Renewal type/offer Average difference in price Age limitation usually Indemnity period (how long covered upon a claim)

Disability work/leisure 24 hours aust wide 7/14 days negotiable 30% more 60 to 65 1/5 years

Salary Continuance leisure only Not usual aust wide 7/14 days negotiable 30% less 60 to 65 1/5 years

Pricing comparison

Individual Disability

Salary Cont/or Group Disability

$350 pa

* $250 pa

Scope of cover – non work (leisure time) Accident $500 pwk and $50,000 capital (lump sum)

* Group Disability policy assumed say a minimum of 10 people under 1 policy.

Policy Divisions Settlement Level of cover Rating factors

The critical difference is a Saving in premium…. ….why…… same principle as a single risk policy versus multiple risks Policy.

Larger base of premium, less paperwork and administration on the insurer.

There will only be 1 policy schedule listing all insured persons. The employer will have to distribute copies of the schedule and collect premium and pay in 1 installment to the insurer.

Asset only Asset and/or Liability Liability only Yes No No Replacement New for Old Indemnity (market Value) No Yes “Gold” – (broadest cover) “Silver” (defined events) “Bronze” (restricted) No Yes No See Disability listing

Premium

See Disability listing

Excess

See Disability listing

Situation

Static / fixed location only

Mobile

No

Yes

General

Best Practices • View the “Disability” check list page – it is in broader detail.

Trivia

Listed under Disability

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SPECIAL ALL RISKS

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Same as "Multi Risks" (see listing).

SPECIAL CONTINGENCY A policy title which can be designated for a number of non standard risks.

Some insurers use this title for "General Property" (see listing) risks however that is generally used to provide cover for Tradespersons tools which are in a mobile exposure.

Some insurers use this title for unusual risks as "Bonds", "Guarantees" (see listings).

In other words the cover will be different form one insurer to another so check the characteristics of cover.

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Spoilage To cover loss of Chilled/Frozen foods as a result of mechanical breakdown claim succeeding under "Machinery Breakdown" or "Fusion" policy.

Policy Divisions Settlement Level of cover Asset Value only

Rating factors

Indemnity (market Value)

“Silver” (defined events)

Occupation/Use; Turnover, Experience, Limit required. Claims experience Minimum of $100 and rates around 10% of the Sum Insured.

Premium

General

Trivia

Excess

Situation

Usually $100 or 10% of the loss

Static / fixed location

Best Practices: 9 Lower rates under a Package policy see “Business Pak” or “Engineering/machinery Pack.

9 This cover can only be taken out incidental to a breakdown or Fusion policy.

Some policies will include Sudden and unforeseen events such as a power failure, but not preannounced events.

If cover is required for a Transport vessel refer to Marine Transit – cargo

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Sports Pack Generally a special policy available to sporting clubs and Associations to cover the social and playing members.

Purpose

Policy Divisions Settlement Level of cover

Covers available:Weekly and Lump sum benefits for Accidental injuries to the players 3rd Party Liability. Options include Member to Member and participation.

You can also take a further option for "Professional Indemnity" to cover coaches and Instructors.

Asset only Asset and/or Liability Liability only No Yes Generally No Replacement New for Old Indemnity (market Value) No

Yes

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Rating factors

Sport, Number of Members, Weekly values, Liability limit, claims history

Premium

Varies substantially based on the hazard of the sport

Excess

Various

Situation General Tips Trivia

Static / fixed location only

Mobile

Yes

No

Best Practices: No volume of dealings to list “best practices” •

Participation and Member to Member is a standard exclusion in Liability Policies

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Strata Title Property This policy is specifically designed to accommodate the Strata Titles Act. The cover is similar to "Home" insurance (see listing) however there are a few critical variations.

Buildings

Level of cover Rating factors

Fixed improvements of the strata.

Most policies include provision for rent if the premises can not be occupied because of a loss which is claimable under the policy ie., Fire, Perils Common contents Typically common areas however it must be owned by the Strata Co. Fidelity Fraud/embezzlement/misappropriation of strata cash/assets Volunteer Workers / committee members whilst carrying out duties for and Personal Accident on behalf of the strata co.

Public Liability General accident associated with normal activities of a Strata complex Office Bearers Liability Protect the Personal Assets of the “Officers” whilst conducting duties as an authorized “officer” of the strata co.

Workers Compensation Employed workers/caretakers Building Catastrophe To allow for major price increase (where labour/materials or in demand) Ie., Sydney hail storm and no building materials for 12 months so price of material and labour escalated beyond sum insured.

Machinery Breakdown Designated motors breakdown either fusion or complete breakdown Asset only Asset and/or Liability Liability only Generally not Yes No Replacement New for Old Indemnity (market Value) Yes Some sections “Gold” – (broadest cover) “Silver” (defined events) “Bronze” (restricted) Most sections Some sections No Size, age, location, Nature or occupation of occupants, value of buildings, Pools, Lifts and any common activity facilities

Premium

Approx 20% lower than rates for home pak

Excess

Usually $100

Purpose

Policy Divisions Settlement

Situation

General

Static / fixed location only Mobile Yes No Best Practices 9 As much as it may be inconvenient to use a strata policy …. Statutory laws obliging almost all Strata properties to be insured under this policy notwithstanding certain exposures can only be covered under this policy.

9 Liability does not cover activities of occupants or their contents, they need their own cover.

9 Office Bearers Liability is essential – The officer has the same exposure as a Director under the Corporations law .. don’t exposure your personal assets.

9 We have a variety of FAQ’s and summary brochure material to help explain this risk.

1. Strata policy does not cover applications to internal walls or any contents owned by individuals, to comply with the Strata Act to allow the individual freedom of choice and as the policy is in accordance with the act most reputable contents insurers include application to internal walls within the contents cover however it's wise to clarify this.

Trivia 2. Liability section covers all common property/areas which would include the area outside each individuals unit. There is an obvious disadvantage if the individual does not take out the appropriate policy. Conversely if you have a private area ie., your unit including a private balcony the Strata Liability will not protect you so it's imperative to effect a contents policy which will include Personal Liability.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Strata Mortgagee Interest Protection Also known as STRATA MORTGAGEE PROTECTION

A dedicated policy to note the interest of a mortgagee (financier) on strata title property.

Purpose

Due to the wording of the Strata Title Act 19.. mortgagees can not be noted on a Strata title policy. For this reason this policy was created to allow the mortgagee to receive a policy noting their interest (otherwise they may not advance the loan).

The insurer Indemnifies the Mortgagee (financier), subject to normal policy conditions, should the property suffer an insurable loss.

As the property is already insured under a strata title policy the rate charged is very nominal.

Policy Divisions Settlement Level of cover

Rating factors

Asset Value only Indemnity (market Value) â&#x20AC;&#x153;Silverâ&#x20AC;? (defined events) Value of Mortgage (not property), Business or Domestic, if Business Occupation of Tenants, Claims history Minimum around $150 and rates around .50c per $1,000

Premium

Excess

Situation

Usually $100

Static / Fixed Location

General

Best Practices: 9 Recommended referral of the brochure 9 If strata unit you will have to consider Landlords Domestic policy

Trivia

We have 1 page summary illustrated brochure available

SUPERANNUATION Investing of premium for a return at retirement age. The value of return is determined by the type of scheme and amount you contribute.

We do not service this product however we can refer you to specialists.

SUDDEN AND ACCIDENTAL POLLUTION COVER See "Environmental Impairment" (see listing)

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Tax audit Affords Indemnity for Professional costs associated with a (ATO) Taxation investigation.

In the event of a notification of a tax audit you may call upon this policy to pay for your Accountant’s costs associated with representing your organisation.

Purpose

Typically the Indemnity options are $20,000 or $40,000 The downtime to your business can be substantial in labour time providing details to tax auditor, however having access to this policy means you can afford to appoint your Accountant to represent your attendance.

Policy Divisions Settlement Level of cover Asset Value only

Rating factors

Premium

Indemnity (market Value)

Occupation/Use; Turnover, Experience, Limit required. Claims experience Based on an Indemnity / sum insured of $40,000 T/Over premium T/over Premium $500,000 $250 $1,Mil $360 $3,Mil $600 Rates lower as part of a Legalexpense policy Excess Situation Usually $100 or 10% of the loss

General

Trivia

“Silver” (defined events)

Not applicable

Best Practices: 9 Lower rates under a Package Policy – see Legalexpense 9 This is a “claims Made” policy – see reference to this clause under PI Best Practices 9 Policy would not be available to be used for pre announced audits of named Industries unless the policy was purchased before the announcement.

9 Does not cover known events, dishonesty 9 Sample of claims, as provided by Vero Insurance in July 05: Industry Clothing retailer Medical Co Financial Planner Jewellery shop Property owner Grocers Carpet Shop

t/over $10mil $5mil $1mil $1mil <$1mil <$1mil $3mil

premium $1200 $500 $400 $500 $400 $450 $400

claim $91,000 $40,000 $17,500 $12,400 $13,700 $5,300 $3,800

audit

start - finished Oct 01 - Mar 02 Oct 01 – Jan 02 Feb 00 – Jul 00 Jan 02 – Apr 02 Feb 02 – Jun 02 Aug 02 – Nov 02 Nov 03 – Mar 04

Links 1. Main Menu 2. All Products 3. Other Insurance info THEFT Same as "Burglary" however, better as it does not require the precedent of violent and/or forcible entry.

Theft is like “shoplifting” no signs of entry.

Naturally this cover is much more expensive and few insurers would allow the cover.

Be cautious – ambiguity ……

9 Some insurers give the title of “Theft” but have the pre-condition of Violent and/or Forcible means which means it's no different to "Burglary" cover.

Same Rating factors and Premiums as "Burglary" (see listing).

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Package policy “Tradespak”

Purpose

A single policy covering a variety of popular / common risks for the average business

General

Best Practices 9 Most Insurers promoting a special Dedicated policy for this risk will include several additional features not available under a standard “package Policy”. These include:a. Broader Liability wording and refined endorsements. b. Broader General Property cover (equipment carried in vehicles) c. Higher limits on artwork 9 “We have summarised the information 1 section – see “Business pak” 9 The premium payable under this Package would be approx 20% lower than a standard Business Pak policy 9 On our website under link to Products see “O/I.R.I” it offers some price indicators for this “Industry”.

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Travel Pack To cover the individual or family whilst on travel.

Purpose

Policy Divisions Settlement Level of cover

A variety of protection from:Cancellations, Loss of money and/or Baggage, Medical Costs, Personal injury, Life Cover and Personal Liability for Third party claims Same sort of covered offered under a "Corporate Travel" (see listing). This is an annual policy with similar selection of covers.

Asset only Asset and/or Liability Liability only No Yes No Replacement New for Old Indemnity (market Value) Depends on section of cover

Depends on section of cover

“Gold” – (broadest cover)

“Silver” (defined events)

“Bronze” (restricted)

No

Yes

No

Rating factors

Destination, Duration, Single or Family, claims History

Premium

Minimum premium $150.

Excess Situation

General Tips

Static / fixed location only

Mobile

No

Yes

Best Practices: 9 Take out well before you leave so it covers cancellation exposure 9 Existing Disabilities are excluded, however some insurers will waive if a medical report is supplied.

If this is required it must be provided URGENTLY to allow time for acceptance.

Medical Cover: There is no cover within Australia as this is already covered under the existing Federal Health System. If you have Private Heath insurance this can be called upon when overseas however they only pay to the level of WA costs. Note there are some limitations on ancillary benefits etc., so check with your Health insurer or better yet take our Travel insurance and be safe.

Trivia Valuables: Most do not provide any cover for valuables, they must be specified or additional cover is required. NOTE: Some home contents policies can be extended to cover Valuables within Australia or Overseas.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Truck Insurance

Page 80

See Motor Vehicle Commercial/cartage (see listing).

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Voluntary Group PA (Personal Accident) To provide Compensation – loss of Income resulting from an Accident and/or Illness during a voluntary service or supply. There are several other policies that do the same thing but with different titles:Disability, Income Protection, Personal Accident/Illness, Salary Continuance Disability – same product – see this section for more product detail including costs.

Purpose

Income Protection – same but with an option to guarantee a renewal invitation – useful if poor claims history but there is a cost for the option.

Salary Continuance – Same as Group PA but designed to cover non work activities Voluntary Group PA – Essentially designed for people volunteering their time in non reward events ie., admin for a social club a body corporate committee. Whilst carry out the authorized duties you may be involved in an accident which prohibits you pursuing your regular work activities.

Policy Divisions Settlement Level of cover Rating factors

Asset only Yes Replacement New for Old No “Gold” – (broadest cover) No

Asset and/or Liability Liability only No No Indemnity (market Value) Yes “Silver” (defined events) “Bronze” (restricted) Yes No

Occupation, Location, Number of persons, weekly benefit and capital value, claims History Minimum premium $700, this would afford: $500 per week income - that you have lost as you are unable to resume your normal job

Premium

$50,000 Lump payout for permanent Injury

General Tips

$350 per week for home care help Excess Situation Generally 7 days Mobile Best Practices 9 View the “Disability” check list page – it is in broader detail.

9 Some policies can include Non Medicare expenses.

9 Liability exposure – Your Employer/Principal’s Public Liability policy may have a gap in cover (does it include Cross Liability in case you are injured by their negligence).

Does not cover the sports players or whilst participating in sports (contact sports) or hazardous events.

No provision for Medical costs – you need health insurance No provision for pre existing injuries

Trivia

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability – Association To provide Legal Liability in respect to a dedicated Industry.

Associations are caught between acting as referee and promoter of their Industry so their exposure becomes complex:

Purpose

Policy Divisions Rating factors

This special policy affords both Director and Officer and Professional Indemnity Insuring clause 1. To Indemnify the insured, where legally Liable, against claims for pecuniary Loss by 3rd Parties caused by a breach of DUTY in the capacity of:1."Officer" in the conduct of their duties and/or 2."Professional" in the conduct of the business Policy Divisions Settlement Level of cover Liability only

Indemnity (market Value)

“Silver” (defined events)

Insured, Industry, Revenue, Number of staff, claims history Minimum of say $1000

Premium

Excess

Situation

Usually around $250

Not applicable

General

Best Practices 9 Make sure your policy is the correct wording, some insurers only provide “PI”.

9 This is a serious exposure – The corporation law makes you personally liability for your actions as a Director – see D&O Policy.

9 Same risk Management check list as PI (Professional Indemnity) Insurance.

9 This policy does not diminish the need for other Liability policies – see the checklist 9 This is a “claims Made” policy – see reference to this clause under PI Best Practices.

9 Check endorsements/exclusions – see reference to this under PI Best Practices.

Trivia

Liability policies only respond to “Resultant Damage” and where you are “Legally Liable.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability – Boiler and Pressure Vessels To cover legal Liability specially related to “Boilers and Pressure” vessels that require special Govt., Certification due to high pressure capacity

Purpose

Policy Divisions

Note some insurers will include this under a standard liability policy but generally only where there is no requirement for statutory certification.

Policy Divisions Settlement Level of cover Liability only

Indemnity (market Value)

Rating factors

Insured, Capacity of Boilers, Age, Claims Experience

Premium

Minimum of say $300 and varies depending on size of Boilers.

Excess

Usually around $250

Situation

Static / fixed location only

Mobile

Yes

No

“Silver” (defined events)

General

Best Practices 9 This risk can be included under an “Engineering/Machinery Breakdown" policy.

Trivia

Liability policies only respond to “Resultant Damage” and where you are “Legally Liable.

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Liability – Broadform

Purpose

Same benefits as "Liability-General" policy however as a "Broadform" the cover is broader by definition.

The difference being a standard Liability policy covers defined events whereas a "Broadform" only lists all exclusions. The gain is that if an event arises which has not yet been excluded then it covered, provided it's part of your known activities.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability – Carriers Legal Liability for a carrier in respect to Customer’s Cargo.

When transporting Indemnify the insured against claims of negligence by 3rd parties for loss and/or damage to cargo carried. Who requires cover:-Private carriers, Common carriers, Domestic carriers.

Private = Operate with protection of a consignment note. Can refuse to carry if cargo not suitable for method of transport.

Common = Operate without a consignment note. Have absolute Liability under Common Law unless loss was by Act of God, Inherent Vice of Goods or fault of Sender/Owner.

Purpose Domestic = Usually operates with a form of consignment note. Carry household goods of "Consumers" as defined by Trade practices Act 1974. Cannot contract out of negligence and has absolute Liability under Trade practices Act 1974.

There is an option for another policy called “carriers Cargo”. For explanation of the difference between Carriers Cargo and Carriers Liability refer to the listing on Marine Cargo Policy Divisions Rating factors

Premium

Excess Situation

Settlement

Level of cover

Liability only Indemnity (market Value) “Silver” (defined events) G.F.E. (Gross Freight Earnings) of carrier including subbies, Operating Radius, Type of Cargo (Livestock/Produce/Household/Other), Maximum Limit any one vehicle, Type of cover and extensions Minimum say $600 and varies according to GFE and limit per load and extensions of cover required. Example rates per $1,000 on say GFE of $100,000 = Per $1,000 Per $1,000 Per $1,000 Pr $1,000 General $4.

House hold $10.

Livestock $7. Hazardous Goods $8 Note rates reduce as S/Ins increase as with most policies listed. $250 to $500 Static / fixed location only

Mobile

No

Yes

Extensions of cover:Some insurers will also allow F.F.C.O. cover for goods not otherwise insured. This helps bridge the gap between this policy and a Carriers Cargo policy. In instances where you may wish to provide some cover as a measure of goodwill to your VIP clients.

General Best Practices 9 The policy is strictly based on the carrier issuing consignment notes.

9 Also consider “Defined events” cover for customer goodwill see “best practices” under Marine transit Carriers Cargo.

For explanation of the difference between Carriers Cargo and Carriers Liability refer to the listing on Marine Cargo Extension for FFCO would be same pricing as under Marine transit Carriers Cargo.

Liability policies only respond to “Resultant Damage” and where you are “Legally Liable.

Trivia

This policy covers claims in respect to cargo items whereas the 3rd party (road risks) liability on the truck policy covers any 3rd party damage caused by the truck or cargo falling.

Road carriers are known as "Common carriers" unless they have a contract of carriage with their customers. In order to pass all responsibility for loss or damage back to the cargo-owner or consignor, road transporters insist upon the consignor of the cargo agreeing and signing their cartage note. The contract should hold the carrier blameless irrespective of the cause of the loss or damage, however you can not avoid you basic "common law duty of care" and should therefore activate a "Carriers Liability" policy to cover legal expenses should a court order you to pay loss &/or damage.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability – Contractual Where a contractual bonus or penalty applies. Legal Liability for Breach of Contract conditions (also known as a “Duty of Performance”).

Example 1: - If the Olympic team had written into their contract a “Bonus” if they won more than 10 gold metals they earn a bonus of $10,000 for the team. This type of risk is also known as "Special Contingency" or “Bond”.

Purpose

Example 2: If a “construction” had a contractual clauses such as If completed ahead of behind a deadline a bonus or penalty would apply or certain terms and conditions are varied such as “hold harmless” conditions which breach traditional common law terms.

Standard Liability covers resultant damage but not performance/warranty/workmanship. A standard Liability policy excludes contractual Liability other than those assumed by common law (common law means in the absence of a contract what would be accepted by community/fair/court rules).

Policy Divisions Settlement Level of cover Liability only

Indemnity (market Value)

“Silver” (defined events)

Rating factors

Occupation, Purpose and Objective of contract, Experience and Qualifications, Limit required.

Premium

Minimum around $1,000 Rates naturally vary quite a bit here. The very broad rate would be around 7%.

Excess

Variable depending on risk starting at 1% of sum insured with a minimum of $250

Situation

General

Trivia

Static / fixed location only

Mobile

No

Yes

Best Practices 9 Do not sign any work place / contracts without qualifying the Insurance obligations with your Broker.

Many contracts oblige you to “waive your Rights” of recover which means you are then in breach of Insurance conditions.

Liability policies only respond to “Resultant Damage” and where you are “Legally Liable. If it is not a legal liability issue then also try :- Bonds, Special Contingency.

Terms that act to the detriment of “common law” are difficult to insure for the simple reason that they are inequitable or stand to force 1 entity to have a conflict of interest.

We have an extensive Library of FAQ’s and risk management on this topic

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability – Defamation Covers the insured against legal Liability to pay damages arising from:-

Purpose

a] Negligent advice, mistake, misprint, erroneous matter or material contained in the insured's publications or broadcasts. and b] Libel, slander, and unintentional infringement of copyright trade marks registered designs or plagiarism.

Policy Divisions Settlement Level of cover Liability only

Rating factors Premium

Trivia

“Silver” (defined events)

Occupation/Use; Turnover, Experience, Limit required. Claims experience Minimum premium $1500. Thereafter no preset rate so a proposal must be completed before a premium can be obtained.

Excess Situation $500

General

Indemnity (market Value)

Not applicable

Best Practices: 9 Lower premium under a package policy - "Liability - Professional" and "Liability - Directors & Officers", and a very limited version under "Liability - General".

9 The policy is a "claims made" basis. That is, the claim or notice of an intending claim must be made within the currency of the policy period, regardless of the actual occurrence date so you may need to keep a policy going for many years after the initial service.

9 This is a “claims Made” policy – see reference to this clause under PI Best Practices.

9 Check endorsements/exclusions – see reference to this under PI Best Practices.

9 Very few clients consider such a policy due to budget constraints or own controls in place. It is likely valued to Corporate or Exotic based activity clients, or those that have experienced the need to have such cover.

View our FAQ’s definition of words to clarify difference between “Libel and Slander” versus “defamation”.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability – Directors and Officers To cover your PERSONAL Legal Liability (this means your personal assets) in respect to your Capacity as an “officer” as defined by the Corporations Law against a 3rd party pecuniary loss resulting from:"The failure to exercise a fair and reasonable level of professional skill or care by the Directors or Officers of the incorporated company in respect to the Management and Administration of the company, within the territorial limits as defined”.

WRONGFUL ACTS (an error, misleading statement, act or omission, or neglect or breach of duty.

Some Exclusions: Dishonesty, Criminal Prosecution, Insured versus Insured, Fines and Penalties.

Purpose

The policy is made up of two interrelated contracts that provide indemnity to both the individual and the Company. However the following points should be noted:1) DIRECTORS AND OFFICERS - covers the individual for personal "loss" when the company can not. (When the individual is Convicted).

2) D & O LIABILITY COMPANY REIMBURSEMENT - as a result of exercising the indemnity the company provides to its Directors and Officers in its Articles of Association. (When the individual is acquitted).

Example of extensions o Trade Practices and Related Legislation, Breach of Contract, Libel and Slander, Intellectual Property, Continuous Cover, Advance Payment of Defence Costs, Official Investigations and Enquiry, Occupational Health and Safety, Subsidiary Cover, Preservation of Indemnity, Severability and Non-Imputation, Estates & Legal Representatives, Entity cover (for EPL) Policy Divisions Settlement Level of cover Liability only Indemnity (market Value) “Silver” (defined events)

Rating factors

Occupation/Activity, No Of Directors/Officers, Special Services provided, Balance Sheet, claims history Minimum $1500. Rate around 1% of Gross profit (sales less stock cost).

Premium

General

Trivia

Excess

Situation

Usually D & O = $Nil Co Reimbursement $5,000

Mobile

Best Practices 9 This is a serious exposure – the corporation Law makes you personally liability for your actions as a Director/Officer.

9 More info may be needed to understand the cover – see “Additional Resource’ below 9 Also consider “Management Liability” – much broader cover options.

9 Some policies will auto include run off cover 9 Is outside directorship an issue 9 Must provide copy of Balance sheet otherwise the insurer will exclude Insolvency cover.

9 This is a “claims Made” policy – see reference to this clause under PI Best Practices.

9 Check endorsements/exclusions – see reference to this under PI Best Practices.

Liability policies only respond to “Resultant Damage” and where you are “Legally Liable.

D & O covers personal actions against Directors/Officers of the company for wrongful acts whilst performing their Duties as administrators of the company – not Professional knowledge in regard to Sales which is “PI”.

Non Commercial activities (clubs and associations) may be able to get a lower rate – see Liability Office Bearer

Additional resource 1. Extensive Library of FAQ’s - including claim scenarios 2. Customer brochure (3 pages) Origin, purpose, types of cover and extensions

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability – EPL Employment Practices Liability To provide Legal Liability in respect to a dedicated Statutory duty.

The law of employee’s rights have encumbered employers to ensure proper practices are maintained, if not they will be Liable for compensation.

Example of Exposures:alleged discrimination against an employee, former employee or applicant because of: o race, colour, age, sex, sexual orientation or sexual preference, disability, pregnancy, marital status, creed o unfair dismissal of employee or breach of employment contract o workplace harassment (whether sexual, religious, political or otherwise) o misleading representation or advertising involving employment o defamation in connection with unfair dismissal or discrimination o unfair demotion or failure to promote o failure to provide career opportunity o denial of natural justice regarding employment o wrongful refusal to appoint a potential employee Policy Divisions Settlement Level of cover o

Purpose

Policy Divisions Rating factors

Liability only

Indemnity (market Value)

“Silver” (defined events)

Insured, Industry, Number of staff, claims history Minimum premium $500

Premium

General

Excess

Situation

Usually around $250

Not applicable

Best Practices 9 This risk can be endorsed into a o “D&O” policy however that only covers the Directors/Officers not the company unless it includes full entity cover. o Corporate Management Liability policy – much broader cover.

9 This is a “claims Made” policy – see reference to this clause under PI Best Practices.

9 Check endorsements/exclusions – see reference to this under PI Best Practices.

Liability policies only respond to “Resultant Damage” and where you are “Legally Liable.

Trivia We have a library of FAQ’s on this topic.

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Liability – HELP Host Employer Liability Policy To provide Legal Liability in respect to a3rd party worker claims.

3rd party workers insurer subrogate the costs of their claims where the host Employer is liable for the workplace injury. The Host’s General Liability insurer are loading premiums or excess to reduce their exposure. This policy allows specific control over the newly created area of litigation.

Purpose

Example:3rd party worker injured on your worksite. o They claim under their workers compensation policy o The “WC” insurer pays the claim determines recovery against you as the entity responsible fort the worksite.

Policy Divisions Settlement Level of cover

o

Policy Divisions Rating factors

Liability only

Indemnity (market Value)

“Silver” (defined events)

Insured, Industry, Number of staff, Value of works involving other contractors, claims history Minimum – tba

Premium

General

Excess

Situation

Usually around $tba

Not applicable

Best Practices 9 This risk is covered under Broadform Liability however more insurers are applying high excesses and premium loadings.

9 Only an exposure if you control worksites where other contractor’s employees are working.

Liability policies only respond to “Resultant Damage” and where you are “Legally Liable.

Trivia We have a library of FAQ’s on this topic.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability - Environmental Impairment Also known as “Sudden and Accidental Pollution cover” To cover the cost of containment and clean up of a spill that could or does cause environmental impairment or pollution.

Purpose

Rating factors

This sort of cover is usually sort after by people dealing with Chemicals. It particularly the event of chemical run off going from the property you are treating and contaminating waterways, Waterboard drainage systems etc., This is a special policy devised to overcome the standard "Pollution" exclusion under a Liability policy. It is not readily available through the local market.

Policy Divisions Settlement Level of cover Liability only Indemnity (market Value) “Silver” (defined events) Nature of Business, Experience, Operations/Activities, Products, Risk Management, Claims history.

Usually not able to get price from the Market without a completed proposal.

Minimum premium $1,000 for say $100,000

Premium

General

Excess

Situation

$1,000 for each and every claim.

Not applicable

Best Practices: 9 If this exposure is so great also consider 9 Management Liability or Statutory Fines cover or “Umbrella Liability”.

Liability policies only respond to “Resultant Damage” and where you are “Legally Liable.

Trivia Public Liability policy includes “Sudden and Unforeseen Pollution”.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability – Management/Corporate To provide Legal Liability in respect to the management exposures of the company and Directors.

Historically only Public Liability existed, over the decades, as more legislation and statues of law have evolved, more Liability policies have been introduced to cater for those exposures.

Concurrently the various Liability policies are written independently of each other however some insurers now grouping policies under one (1) package creating mutual benefits to the insured and insurer (one policy, less premium, more cover).

Purpose

Policy Divisions Rating factors

Typical policy sections:[1.1] HUMAN RESOURCES LIABILITY (EPL) 9 This incorporates EPL (Employment Practices Liability) [1.2] SUPERANNUATION TRUSTEES LIABILITY (Trustee) 9 This incorporates a Trustee Responsibility Breach in respect of the staff superannuation fund [1.3] PERSONAL LIABILITY (D&O) 9 Wrongful Acts where the Directors and Officers may be held, in part or full for Damages relating breaches of statutes relating to their Duties.

[1.4] Company Reimbursement (D&O) 9 This incorporates cover for the company to provide indemnity to its Directors and officers for claims made against them alleging a Wrongful Act. Please see the link on D&O to appreciate the exposure to the Assets of the Directors/Officers.

[1.5] PRIVATE COMPANY LIABILITY (entity cover) 9 Wrongful Acts where the company may be held, in part or full for damages relating to breaches of statues relating to Directors and Officers Duties. It also includes reimbursement of Director's Defence costs.

[1.6] Crisis Containment (PR costs) 9 The cost of retaining a Public Relations Consultant to assist the management and containment of a Crisis which can effect the company, it's clients and Suppliers.

[1.7] Fidelity Guarantee (Crime) 9 This incorporates Fidelity; Employee theft or Dishonesty Note – this does not include “Public Liability” Policy Divisions Settlement

Level of cover

Liability only

“Silver” (defined events)

Indemnity (market Value)

Insured, Industry, Revenue, Number of staff, claims history Minimum of $2000 rate is approx 1% of Turnover on diminishing basis on premiums over $5,000

Premium

General

Excess

Situation

Usually around $500

Not applicable

Best Practices 9 If insolvency extension required – need to provide copy of Balance sheet – same as a D&O policy.

9 This is a “claims Made” policy – see reference to this clause under PI Best Practices.

9 Check endorsements/exclusions – see reference to this under PI Best Practices.

This type of policy is much broader than traditional Directors and Officers (D&O) policy – see the additional sections.

Liability policies only respond to “Resultant Damage” and where you are “Legally Liable.

Trivia

Very few clients consider such a policy due to budget constraints or own controls in place. It is likely valued to Corporate or Exotic based activity clients, or those that have experienced the need to have such cover.

Separate FAQ library information available (sample claim cases etc.,)

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability – Not for Profit Special “package” liability policy for Management of “non profit” organizations.

Covering: The organization, directors, officers, committee members, trustees, employees and volunteers

Purpose

Policy Divisions Rating factors

Example of covers 9 Employment claims 9 Personal Injury claims 9 Libel and slander 9 Publishers errors and omissions 9 Management errors and omissions

EPL D&O – entity D&O

Note – this does not include “Public Liability” Policy Divisions Settlement

Level of cover

Liability only

“Silver” (defined events)

Indemnity (market Value)

Insured, Industry, Revenue, Number of staff, claims history Minimum of $1000

Premium

General Trivia

Excess

Situation

Usually around $500

Not applicable

Best Practices 9 Similar to ”PI” best Practices The policy is similar to an “Association Liability” in that it covers the Entity and Individuals for their management decisions.

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Liability – Primary excess Layer To secure a limit of Indemnity with another insurer which will operate with a limit already insured.

This is like a second or backup cover. An insurer that will follow the same cover as the first insurer but their cover will not “”kick in” until the first or “primary” insurer’s cover is exhausted.

Purpose

Policy Divisions Rating factors

Premium

Typically this means the first insurer is covering the 1st $5mil and the next insurer is covering the 5,000,001 to say $10mil Example:st 1 or primary insurers’ limit 2nd or Primary excess layer Policy Divisions

Settlement

to 5,000,000 to 10,000,000 Level of cover

Liability only

Indemnity (market Value)

“Silver” (defined events)

Insured, Industry, Revenue, Number of staff, claims history Minimum of $1000.

The rates are usually significantly lower than the primary insurer taking into consideration their exposure.

Excess Situation Usually around $500

General

0 5,000,001

Not applicable

Best Practices 9 Similar to ”PI” best Practices

Trivia

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Liability – Office Bearers Same as "Liability-Directors and Officers". See that listing for details and characteristics of cover.

The change in title to “Office bearers” is more commonly associated with people that volunteer to “passive” (non commercial) Community entities such as:

Purpose

9

Delegates/committee persons of clubs, or Non profit organizations

9

Strata title properties / Body Corporate

Premium for these passive “Non Commercial” ventures can be as low as $500 to $600 depending on the size of the organization.

This policy is only to cover the personal assets of the officers – it does not replace all other Liability exposures.

Best Practices 9 Please be warned – the change of title does not escape the exposures subject of the Corporations Law which means your Personal Assets are at risk.

9 Same best practices as D&O cover 9 If you are acting on Behalf of a o Strata Co – A strata Title Policy can include the D&O or Office bearer exposure o Association – an Association Liability can include the D&O or office bearer exposure

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability – Products To cover your Legal Liability to 3rd parties of the nature, condition and/or quality of the product.

This cover is usually placed within the Public Liability policy and referred to as part 2 of the policy.

"PRODUCTS" means anything (after it has ceased to be in the possession or under the control of the insured) manufactured, constructed, erected, installed, repaired, serviced, treated, sold, supplied or distributed by the insured (including any container thereof other than a vehicle). NOTE: If you are an Importer you are deemed the Manufacturer !

Purpose

COVER: Resultant damage caused by the nature, condition or quality of your products within the Commonwealth of Australia or the Dominion of New Zealand and overseas countries (EXCEPT USA & CANADA) in connection with the insured's business.

Policy wording is either "Occurrence" or "Accident" - see under Liability - General for definition.

EXCLUSIONS:- In addition to the General Liability exclusions there are others specifically relating to "Products". They are listed under the Liability General.

NOTE: There are special contracts available to cover such exclusions however these are quite expensive, say around $10,000 minimum and are restricted to the London market.

Policy Divisions Settlement Level of cover Liability only

Rating factors

Premium

“Silver” (defined events)

Type of Product, Territorial Limits and Sales Turnover, and claims experience Minimum $500 Note this would normally be included in the Public Liability premium. If the products are incidental to the insured's trade there would be no charge. Otherwise the premium varies according the product, volume and end user industry.

Excess Situation Usually $250

General

Indemnity (market Value)

Mobile

Best Practices 9 Include under a standard Public Liability Policy 9 Product recall is a separate policy.

Liability policies only respond to “Resultant Damage” and where you are “Legally Liable.

Trivia We have an extensive Library of FAQ’s and risk management on this topic

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability – Public

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The most fundamental policy required for every business…… in addition you WILL require more Liability policies or extensions/variations to this policy depending on:- Activity, size, Location The key issue is not just “NEGLIGENCE” but a ‘BREACH OF DUTY OF CARE”. A breach is often something your not aware of because of changing laws and court determinations.

The policy responds to “ALLEGATION COVER”, where a 3rd party ALLEGES you are liable for their loss. The allegation costs can be horrific let alone the stress of dealing with the allegation.

Purpose

Insuring clause:rd A “General Liability” policy indemnifies (protect) the insured against claims by 3 Parties (members of the Public) arising from loss and/or damage to property and bodily injury caused by your negligence/ accidents happening during the period of insurance in connection with your known activities.

A General Liability policy comprises several critical sections of cover:1. GENERAL Liability to the 3rd parties, other than:2. PRODUCTS - anything you service/test/install once it leaves your Possession 3. CCC - Property of others deemed to be in Your Custody, Care and/or Control 4. EXTENSIONS - to address specific exposures of your known Activities.

5. EXCLUSIONS - apart from the standard to all policies the insurer may Exclude specific Exposures.

Policy Divisions Settlement Level of cover

Rating factors Premium

Liability only Indemnity (market Value) “Silver” (defined events) Industry; nature of business/activity , Turnover (size of business), Wages, Location (geographic limits apply), Claims history Minimum $600 These vary according to the likely exposure. $5mil = Office risks from $500, Retail $650 Trades $700l Excess Situation Usually $250

Mobile

General

Best Practices 9 Consider the policy as “Allegation cover” and the cost and personal trauma of defending the action.

9 Liability cover should be a priority over your Asset cover – (You can measure the loss of your Asset cover but Liability is unknown).

9 Liability policies only respond to “Resultant Damage” and where you are “Legally Liable to a 3rd party. If you are concerned about “customer goodwill” consider asset cover policies for certain events.

9 Increasing limit is nominal cost (rates based on Layer system) 9 Lower rates under a Package policy – see “Business Pak”

Trivia

Extensive as listed below

General guide to:INSURED= Named policy holder, it's Personal representatives, Any Principal, Any Directors, officers, Employees, Social Committees; First Aid (not qualified doctors), Social Members; Canteen; Welfare organisations formed for the benefit of the employees all the above with the consent of the policy holder insured and in connection with the activities disclosed TERRITORIAL LIMITS= Generally within Australia & its external limits &/or elsewhere in the world but only for non-manual work where the insured normally resides within Australia and excluding Claims in USA & Canada &/or countries where the insurance must be placed locally by law unless otherwise stated.

What limit do I need?

Take into consideration the "Units (claimants) of exposure", that is, the number of people likely to be claiming for any one event. Example there is much more of units of exposure in a shopping centre than the corner deli.

Likewise you should consider this if your "Product" (restaurant) is used by many people at once.

Why would I need PRODUCTS Liability?

Basically anything serviced, tested and/or installed becomes your "product", once it leaves your possession.

Why would I need “CCC” (goods in Custody care and/or Control)?

The policy has a pre set limit for loss to 3rd party property when in your “CCC”, because the insurer needs to know moiré about the risk if you have more than the expected. The sub-limit will vary according to your occupation and amount required. The rate is usually around .60% of the sum required.

What do they mean by “resultant Damage?”

This means the costs of the resultant damage caused by incident but not the cost of rectifying or re-doing your rd actual work which is your work not a 3 party cost.

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Example: You service a car and replace the spark plugs. Later the motor explodes and it is clear this is a result of your error/negligence. The insurer would not pay to have the service redone or spark plugs replaced as this was your work however they will pay for the resultant damage being the damage to motor.

Why is “faulty Workmanship” excluded This is not a 3rd party loss, it is your work. The cost of your work is your guarantee or performance however the rd insurer will cover the cost of the resulting damage incurred by the 3 party.

This exclusion can be bought off with some insurers, costs is around .60% of the sum required.

Why is importing an issue?

Under Australia Consumer Laws if you are the Importer you are deemed to the Manufacturer therefore it is ESSENTIAL that you have "Products" extension.

Why are Sub-contractors an issue?

As the Principal – you have a contingent Liability for Sub-Contractors and their staff. This is otherwise known as "Vicarious" Liability which should be taken very seriously. It means that you, as the principal" have a responsibility or "duty of care", not just for your staff, but for the staff of all sub-contractors. We have special forms for you to monitor this exposure.

Can I cancel the policy anytime?

Liability policies should not be cancelled mid term, in fact one should consider keeping the policy going for some years after you have ceased trading ! - Reason:Most General Liability policies respond only where the "Date of Loss" is during the currency of the policy. So, you may have installed/sold something today but a loss may not be sustained for some years after so you need the policy current at the time of the loss. Certain Liability policies do not respond based on “Date of Loss” but Date of claim” so be careful, check with your broker.

What other extensions issues are needed?

This policy excludes a variety of events; in circumstances where the obvious exposure is too great and in most cases where there is another obvious policy available, such as:Employees as there is a Workers Compensation policy.

Cargo carried as there is a Carriers Liability policy Pollution (see "Environmental impairment" cover).

Professional error as there is a Directors & officers or Professional Liability policy.

There are many extensions and variations, far too many to list, however we have listed some as examples. Please ensure that you give a full description of your occupation/activities, at your place of work and away so that recommendations can be made. Statutory laws are very broad so you may have a lot more responsibility than 1st thought.

There are a variety of extensions available for Liability and some are listed hereunder:-\ AUTHORSHIP (what is written is agreed) AUTOMATIC REINSTATMENT (auto reinstatement of sum insured) BOILER/PRESSURE VESSEL EXPLOSION (NON CERTIFIED) (for items that require Govt., certification) Car Parks/Parking (provided no reward or auto service) (car parks of the insured) CCC Goods in Physical CUSTODY CARE &/or CONTROL rd (property/equipment of 3 parties) Completed Operations (constructional jobs) Construction Limitation Value of $^ (constructional jobs) Cross Liabilities (other parties comprising the insured) DEFECTS liability period of indemnity = ^ months (construction jobs) DEMOLITION consequential to works (constructional jobs) Drilling and BLASTING (self explanatory – additional to cover) DRIVER Risk 1 (Road test/Delivery of Regst Vehicle/s) " " " " 2 T.P.O. Exposures from Drivers Risk (Motor vehicle trade) FAULTY Workmanship (rectification of your work) (standard exclusion) FUEL supply standards (for fuel storage/depo) GOODS sold &/or supplied

(self explanatory – additional to cover) Hoists, Cranes and Unregistered Vehicles (self explanatory – additional to cover) Hook Risk (items falling from the Hook) (self explanatory – additional to cover) Inspection Parties (self explanatory – additional to cover) Liabilities under LEASE (at common law) (self explanatory – additional to cover) Lifts, Elevators, Escalators (self explanatory – additional to cover) MARINE Pleasure craft Liability (self explanatory – additional to cover) MEMBER to Member (for incorporated clubs) MOTOR VEHICLES - Tool of Trade (Regist Vehicles) OFFSHORE/OIL RIG manual work ( < ^% OF T/OVER) (self explanatory – additional to cover) OVERSEAS manual work - Countries are: ^ (self explanatory – additional to cover) PARTICIPATION in actual SPORT or EXERCISE activity (self explanatory – additional to cover) Plant HIRED in / out (self explanatory – additional to cover) POLLUTION (sudden and unexpected) (standard exclusion) PREMISES: Tenants/Property Owners as appropriate (self explanatory – additional to cover)

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Client Insurance Product Library As at 10/09/2007 PRINCIPAL'S INDEMNITY in respect to insured Activities (self explanatory – additional to cover) PROFESSIONAL DUTY (where such capacity exists) (standard exclusion) Products Liability (self explanatory – additional to cover) Social and welfare facilities (self explanatory – standard cover) Sub-Contractors of the insured (VICARIOUSLY ONLY) (self explanatory – limited cover) Treatment/s Administered &/or Prescribed (self explanatory – additional to cover)

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UNDERGROUND works (Provided prechecked (dial before dig)) (self explanatory – additional to cover) Vibration, removal and/or weakening or supports (self explanatory – additional to cover) Watercraft (self explanatory – additional to cover) Welding/Flame cutting/application of heat (self explanatory – additional to cover) Worker to Worker (self explanatory – additional to cover)

The cost of these extensions vary according to the potential exposure.

TYPICAL EXCLUSIONS:- LIABILITY - TYPICAL "MAJOR" EXCLUSIONS:Unless otherwise endorsed the typical Major Exclusions are:GENERAL exclusions:- Injured Employees, Registered Vehicles, Loss of Use, Radiation, War, Nuclear Fuel/Weapons, Maintenance Agreements, Waiver of Rights, Defective Work, Pollution; expected and/or intentional, Professional Duty, Contractual Liability, Libel and Slander, Weakening of Supports, Aircraft, Watercraft, Asbestos, Large scale Demolition, Explosives and/or Blasting, Certified Boilers/Pressure vessels, Property in Custody, Care, and/or Control, Participation in Sport, Territorial limits, Products, Any Exemplary &/or Punitive Damages, and as further detailed in the insurer's policy.

"PRODUCT" exclusions:- Recall, Guarantee, Contamination, Tampering, Loss of Use (ie., by delay or failure), Replacement, Correction, Repair, Known Defects.....and/or as Further Defined in the insurer's policy wording.

Other resources • FAQ (Frequent asked questions) available

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Liability – Professional To protect the insured from liability arising from breach of professional duties assumed by, or imposed upon by the nature of the profession.

Such liabilities may include liability for bodily injury (for example: Dentist and Doctors) or damage to property (for example: Architects and Engineers). These Liabilities may also relate to pure pecuniary loss (for example: Accountants, Stockbrokers) or even "intangible loss" such as defamation of character (for example: advertising agents and publishers).

The broad rule is that a "professional capacity" exists and "professional duties" are created where the service provided is of a specialised kind and wholly advisory or representative by nature.

Purpose

Essentially if your revenue is not product related you need to consider “PI”. Unless you wish to take on the trauma of defending allegations and can be comfortable with measuring the quantum of loss.

Sample of extensions of cover: Automatic Reinstatement, Dishonesty, Fidelity, Loss of Documents - Property Damage, Libel and Slander, Outgoing Principals, Previous Business, Trade Practices Act/Fair Trading….. detals of these are available in our FAQ library.

Policy Divisions Settlement Level of cover Liability only Rating factors

Indemnity (market Value)

“Silver” (defined events)

Profession, Fee revenue only (not product sales), CV, Claims history Minimum premium $1500. Approx 1.5% of fee income

Premium

General

Excess

Situation

$1,000 minimum

Mobile

Best Practices 9 Consider the policy as “Allegation cover”. What needs to be considered is the cost and personal trauma of defending the action (examples available in our faq library).

9 Proposal must be completed before an insurer will quote – have all staff confirm the answers to protect your disclosure otherwise seek severability / non imputation clause).

9 Only declare your Fee Income (not Product sales) as it is the fee income upon which advice is rendered.

9 The policy is a "claims made" basis. That is, the claim or notice of an intending claim must be made within the currency of the policy period, regardless of the actual occurrence date so you may need to keep a policy going for many years after the initial service (run off cover).

9 Qualify “retroactive date”. This means if the date is “unlimited” you will be covered for previous activity period (if a date is shown then only activities form that date are covered – not good).

9 Not all policies are the same – must check: o Each insurers endorsements and exclusions

Some endorsements are in fact exclusions

Some insurers don’t list the endorsement/exclusions in their quote schedule as they are already in their policy wording.

The aggrieved party must suffer a pecuniary or economic loss before the policy will respond, and must occur within the territorial limits as defined in the policy.

Trivia Liability policies only respond to “Resultant Damage” and where you are “Legally Liable.

We have an extensive Library of FAQ’s and risk management on this topic

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability – Road Risk To cover your Legal Liability to 3rd party Property only for Registered Vehicles. It is more commonly known as “T.P.O” (Third Party only).

This type of cover is usually section 2 of a Motor Vehicle Policy.

Purpose

Some insurers, specializing in “C.P.M.” (Contractors Plant and Machinery) can NOT include “T.P.O.” for registered machines in their Pant / Vehicle policy so this separate policy is issued.

Policy Divisions

General

Settlement

Level of cover

Liability only Indemnity (market Value) “Silver” (defined events) Best Practices 9 Same as respective policies ie., Motor Vehicle – standard, Commercial/Cartage 9 If vehicle is also used as a “tool of trade” (not just road transport) check the policy has extension for this activity (see comments under trivia) Caution - understand deviation in cover/s:rd When a Regtd., vehicle is driven on roads/thoroughfares … this is Road Risk (3 party liability) • Note:- Bodily injury to 3rd parties is covered by the compulsory insurance included in W.A. vehicle licence registrations.

Trivia

When a Regtd., vehicle is operated as a “tool of trade” (lifting/digging) … this is public Liability as a “tool”.

• A public liability policy covers property damage/bodily injury to 3rd parties, excluding loss caused by Regtd., vehicles (covered under a vehicle policy).

Any damage to a 3rd party by items falling from the Redtd vehicle (debris) is included but not the cost of damage to the actual items falling from the vehicle (this would cargo cover or carriers Liability) So a recap rd Road Risk Liability (3 party liability) is for Regtd vehicles when used as a Road vehicle Public Liability (3rd party Liability) is for a business activity including vehicles when used as “tools of trade” but not Regtd vehicles when used as a vehicle on the road.

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Liability – Umbrella As its name suggests – it provides excess limits of indemnity over the client's Primary Liability insurance policies ("underlying insurance"), as well as providing Difference in Conditions (DIC) cover from the ground up for certain events excluded under the Primary policies.

Purpose

The “DIC” cover is subject to a Self Insurance Retention, or excess, and this is generally $5,000.

It is designed to cover catastrophe or unforeseen losses and it is therefore fundamental to the cover that the client has an adequate Primary Liability insurance programme in both scope and limits.

Policy Divisions Settlement Level of cover Liability only

Rating factors

Indemnity (market Value)

“Silver” (defined events)

Industry, Revenue, Claims history Minimum $2000

Premium

Excess

Situation

Usually $5000

Mobile

Some examples of the broader cover provided by an Umbrella which are generally not always provided

by Primary Insurances are:* * * *

General

Incidental Professional Negligence Advertising Liability Contractual Liability Liability for damage to goods in care, custody and control

* Error in design, formula or specification * Personal Injury * Loss of Consortium * Aircraft or watercraft chartered by the Insured with crew supplied * Property Damage - cover includes loss of use of property which has not been physically injured or destroyed * Malpractice - provides incidental cover for company doctors, nurses or first aid facilities * Additional Insured's - subsidiaries, partnerships, joint ventures etc * Worldwide territorial limits Best Practices 9 Request our independent Brochure for more detailed review

Trivia

9

This class of risk, due to its cost is only considered by large corporate or exotic risk clients.

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IT & T (Information Technology & Telecommunications To provide Legal Liability in respect to a dedicated Industry.

Purpose

To explain – the Legal system was not sure if the loss is a Product (software is not product - more a licence to use the software) or a Professional issue in terms of design or advice?

The Insurance Industry created a hybrid (spin off) policy which covers both Professional Duty and Public Liability and Products.

Policy Divisions Settlement Level of cover Liability only

Rating factors Premium

Trivia

“Silver” (defined events)

Occupation/Use; Turnover, Experience, Limit required. Claims experience Minimum premium $1500. Thereafter no preset rate so a proposal must be completed before a premium can be obtained.

Excess Situation $500

General

Indemnity (market Value)

Not applicable

Best Practices: 9 Territorial limit may become an issue? Ie., within Australia or further ?

9 This is a “claims Made” policy – see reference to this clause under PI Best Practices.

9 Check endorsements/exclusions – see reference to this under PI Best Practices.

Liability policies only respond to “Resultant Damage” and where you are “Legally Liable.

If this type of policy is purchased the insured no longer needs a separate Public Liability. However as the costs of the limit of liability is not cheap (is any Professional Liability policy) most clients take a conservative limit so you may have to continue a separate PL policy in order to maintain a reasonable Public Liability.

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Liability - Malpractice To provide Legal Liability in respect to a dedicated Industry.

Insuring clause: To Indemnify the insured, where legally Liable, against claims for BODILY INJURY by 3rd Parties caused by a breach of DUTY in the conduct of the insured's "Profession = ……………………….

Purpose

Rating factors

Sample extensions of cover: o Automatic Reinstatement o Good Samaritans Act o Indemnity for Committee Members o Libel and Slander o Student's Coverage Policy Divisions Settlement

Level of cover

Liability only

“Silver” (defined events)

Indemnity (market Value)

Medical field, Turnover, Experience, Limit required. Claims experience Minimum premium $1500. Insurers will not quote without a completed proposal

Premium

General

Trivia

Excess

Situation

$500

Not applicable

Best Practices: 9 This is a hybrid form of “PI” therefore refer to the PI best Practices 9 This is a “claims Made” policy – see reference to this clause under PI Best Practices.

9 Check endorsements/exclusions – see reference to this under PI Best Practices.

We have an extensive Library of FAQ’s on this topic.

Liability policies only respond to “Resultant Damage” and where you are “Legally Liable.

The policy is designed to Indemnify the Insured, being the Practice and all non qualified medical staff (Doctors have their own personal PI cover) – request more from our FAQs

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Liability – Ship repairer This policy is Occupation specific and additional to “General liability” policy as marine risks are excluded in most insurers Treaties (re insurance programs).

Purpose

Remember General/Public Liability policies have a Marine Exclusion (usually vessels above 8 mtrs) If you conduct any type of INSTALLATION, REPAIR or SERVICE work on vessels.

There are a variety of extensions such as:- Slipping, Testing on water, Storage etc., Policy Divisions Settlement Level of cover Liability only

Rating factors

Premium

“Silver” (defined events)

Occupation/Use; Turnover, Experience, Limit required. Claims experience Minimum of $950 for small size business on sum insured.

Example: Limit $ 750,000 rate say 4% of T/over & Excess say $1,000 Limit $1,000,000 rate say 3% of T/over & Excess say $2,000 Note: The rates vary according to Limit and excess.

Excess Situation $500

General

Indemnity (market Value)

Not applicable

Best Practices: 9 The policy usually does not have a sub-limit on "CCC" which means you should have cover to the full limit of the indemnity.

9 The policy usually includes a Liability Defects period of 06 mths. This means any resultant damage that may occur within 06 months after the work is released as a result of your negligence.

Liability policies only respond to “Resultant Damage” and where you are “Legally Liable.

If you are also building you will need a "Boat Builders" policy (see listing).

Trivia

Some more information on the restriction of cover under a Public Liability policy … It relates to the trigger of :3. Length – usually 8 mtrs 4. Whether in legal control, possession What is important is the intention – The ship repairers policy was created to deal with the specific issues of “Maritime Laws”.

The decision to take both covers is more often 1 of an economic decision combined with the nature of work conducted.

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Liability – Statutory fines To provide Legal Liability in respect to a dedicated Statutory exposure The policy will provide Indemnity for “statutory” fines, that is, where the insured has innocently breached corporation laws the policy will pay the fine/s.

Purpose

Policy Divisions Rating factors

LIABILITY COVERAGE for breaches associated with and where 1st insured for:• D&O/Company Reimbursement • D&O/Supp Legal Expenses • General Public Liability and Products • PI (Professional Indemnity) • EPL (Employment practices liability) • Other Policy Divisions Settlement Level of cover Liability only

Indemnity (market Value)

“Silver” (defined events)

Insured, Industry, Number of staff, claims history Minimum of say $2,000

Premium

Excess

Situation

Usually around $250

Not applicable

General

Best Practices 9 No other Liability policy pays “Punitive/Exemplary fines” (some entity cover under Management Liability) 9 The trigger to this policy would be innocent breach of law.

9 Very few clients consider such a policy due to budget constraints or own controls in place. It is likely valued to Corporate or Exotic based activity clients, or those that have experienced the need to have such cover.

9 This is a “claims Made” policy – see reference to this clause under PI Best Practices.

9 Check endorsements/exclusions – see reference to this under PI Best Practices.

Trivia

We have a library of FAQ’s on this topic.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Liability – Superannuation trustee To provide Legal Liability in respect to a dedicated Industry.

The Superannuation Industry supervision act 1993 (SIS) imposed additional responsibilities on those who manager the funds by enhancing the fiduciary duties of trustees. Regardless of the nature and extent of external assistance and recommendations, the trustee remains personal liable for decisions made on behalf of fund beneficiaries.

New laws issued in 2002 relate to “M.I.A.” (Managed Investment Act) which place significant responsibility on “single entity” responsible for management of funds.

Purpose

This is a basic form of “PI” Professional Indemnity, modified to suit the specific statutory obligations.

Typical exposures: 9 Breach of Fiduciary duty 9 Wrongful administration 9 Tribunal complaints 9 Improper disclosure to fund members 9 Selection of inappropriate advisers or service providers 9 Improper advice or counsel 9 Imprudent investment or lack of investment diversity Policy Divisions Settlement

Rating factors

Level of cover

Liability only Indemnity (market Value) “Silver” (defined events) Type of Fund, Types of Investments managed, Revenue, Limit of Indemnity required. Claims experience Minimum premium $1500. Insurers will not quote without a completed proposal

Premium

Excess

Situation

$1,000

Not applicable

General

Best Practices: 9 Some cover provided under “Management Liability” 9 This is a hybrid form of “PI” therefore refer to the PI best Practices 9 This is a “claims Made” policy – see reference to this clause under PI Best Practices.

9 Check endorsements/exclusions – see reference to this under PI Best Practices.

Trivia

9

We an extensive Library of FAQ’s on this topic.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

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Workers Compensation It is imperative to recognize this cover is compulsory by law.

There is a specific STATUTE of law governing this risk. The act comprises some 500 pages, we are attempting to consolidate the information into 1 page The policy will to indemnify (protect) the employer against claims from workers for work related injuries.

The benefits are in accordance with the relevant act of each State.

Basically a "worker" is anyone engaged by you for the purpose of your trade or business that receives any form of reward (payment) in essence for their personal manual labour. (The emphasis being payment for the person personal manual labour (not other things such as plant/equipment/staff).

Purpose

A simple test is:1) Does the work being done form part of your trade or business? considered a worker

It must be YES to be

2) Is the bulk of the payment for personal labour of the person appointed by you to do the actual work. ie., would there be much difference in the hourly rate if they were an employee. If yes then the bulk of payment is for other things so they would not be considered a worker - if not then the bulk of payment is for their personal labour so they would be deemed as a worker.

We have excellent summary and detail brochure material on the topic as well as FAQ’s Policy Divisions Settlement Level of cover Liability only Indemnity (market Value) “Gold” Broadform Rating factors

Industry, Location, Risk management controls, claims history, Wage values Minimum premium $300 and is highly recommended, for "peace of mind" in the event that you are not sure if you should have the policy.

Premium

Approx rates against wages/labour value: Office risks 2%, Retail risks 4% Trade Risks – light 5% medium 8% heavy 10% Excess Situation Nil

Mobile

Best Practices: 9 9 9 9

General

9 9

Every business should have a policy even if they don’t appear to have workers (be they personal or a contractor). It’s a small price to pay to cover “allegations” and defence costs.

The premium is based on estimates and adjusted on renewal.

Activate the Sub-contractor section and get refund on subsequent renewal declaration if not used.

Be aware of entity variation ie., if Incorporated name Directors otherwise name working family members residing in insured’s home Journey cover (non work related is not covered) separate policy available see listing for Journey Additional variations or covers (see next page for more detail) o Increased Common Law limit o Named Principals extension o If workers visit mine sites:o need separate policy for Industrial Disease o need to consider extended standard policy for Common law on mining sites o If workers travel interstate (cross boarder) or overseas:-o Need a corporate travel policy for GAP cover

Trivia This type of Liability is absolute or Direct duty of Care (see definition under Liability - The concept etc., at the front of this Library). The benefits to workers are as per the Act, this includes medicals and present/future income and rehab costs. The common law cover is for cases where the worker (not sub-contractor) ledges a 2nd claim under common law (lump sum) 9

The policy is “strict” liability – regardless of what happened the employer is liability.

This topic is continued on the next page

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

Copy of this library is on our website

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Variations: Named persons – if the insured entity is • Incorporated Workers Directors must be named and declare their wage/salary estimate.

•

A individual/partnership – working gamily members that reside in the owners residence must be named

"Common Law" Limit – You can increase the limit (usually at the request of a Principal – cost approx 5%) “Common Law” for Mining sites (only if you visit Mining sites – cost approx 1%) "Principal's Indemnity" – Naming the Principal (in addition to the standard blanket cover) - cost approx 5%.

If workers are o Visiting Mining sites – you also need a separate compulsory policy called “WC Industrial Disease”. The policy is issued by the govt., - cost approx $300 for 3 year period. The cover deals with inhalation of mineral dust.

o o

need to consider extending the standard WC policy for Common law on mining sites

If workers travel interstate (cross boarder) or overseas. Need a Corporate Travel corporate travel policy for GAP cover. Standard Workers Compensation policy reduced for certain overseas exposures and the employee can claim the difference against you.

Public Liability – will be necessary re common law for Sub-contractors – see comment after “Indemnity” below General Definitions/interpretations The WC Act refers to “Workers” not “employees”. o The primary definition of a “worker” is commonly known as an employee and the extended definition of a “Worker” is commonly known as a sub-contractor.

•

A person of service is an Employee. A person for service is a Sub-contractor.

•

Did you know ... you also have a contingent Liability to Subbies and their staff as their Principal in respect to works under your control. This is otherwise known as "Vicarious" Liability and it should be taken very seriously. It means that you, as the "Principal" have a responsibility, not just for your staff, but for the staff of all sub-contractors. We have special forms for you to monitor this exposure.

Wages for “Workers of Service” (employees) and for “Workers for Service” (Sub-contractors) as set out in the instructions on the reverse of our wages declaration Indemnity (summation only)

INSURING CLAUSE FOR WEST AUST ACT (STATE LAW) Section 1: Legal Liability (Absolute) to Workers as defined in the Workers Compensation and Rehabilitation Act in respect to Work Related Injuries including "Principals Indemnity" (per Section 175).

Section 2: Common Law Limit within Australia up to $^50,000,000 per person or persons arising from the one event for "Workers of service" and not "Workers for service" (Sub-Contractors) as defined.

Nb: Section 2 “common law” does not respond to Sub-contractors – ensure you have a public Liability policy with appropriate Territorial limits. o Ultimately it’s prudent to use the same insurer for “Workers Compensation” and “Public Liability” so that, if in the event of a dispute if the worker is an employee or sub-contractor it will not matter as the insurer is the same.

Other support information:In summary or detailed as required.

Library of FAQ (frequent asked questions).

Wages declaration – instructions define cover, wages and how to complete.

DISCLAIMER This is not advice per se. The intention is to provide you with a brief introduction, it does not dismiss the need to review the matter with a qualified Professional representative.

Copy of this library is on our website