NZ Trucking Magazine, August 2023

Page 114

BUSINESS TOGETHER

The rising cost of

INSURANCE IN BUSINESS Insurance premiums are an essential aspect of business, but unlike other expenses, they have the potential to increase significantly.

I

t is crucial to understand the coverage provided by insurance companies and take the initiative to understand your business risks. I have a business myself and have seen dramatic hikes in our premiums, leading us to reassess what we are insuring and the dangers we face if we self-insure. There are some instances where you can effectively manage through alternative methods. For example, the risk of financial collapse can be managed through robust budgeting practices, efficient cashflow management and regular reporting. It is also apparent that most businesses do not understand their coverage until they make a claim and are faced with coverage issues. Many are looking at dropping some insurances altogether. I urge you first to consider the following: Undertake a comprehensive risk assessment: Begin by identifying and evaluating all the risks your business faces and take proactive steps to mitigate them. While some risks can be addressed through insurance, others may require alternative risk management strategies. Recognising that not all material business risks can be insured against is important. Adjust the policy excess: Evaluate the type of coverage required and

its impact on the premium structure. Consider making a sound commercial decision regarding the level of financial compensation necessary in the event of a claim. For example, medical insurance policies have transitioned from covering total medical expenses to focusing solely on surgical costs. Some businesses may opt not to claim for minor damages and instead prioritise coverage for catastrophic events. Bundle policies: Many insurance providers offer discounts for bundling multiple policies. Explore the possibility of consolidating liability, property and motor vehicle insurance with a single provider to benefit from cost savings. Engage insurance experts: Seek the assistance of knowledgeable insurance brokers who can analyse various providers, policies and terms. They can provide valuable insights into coverage options, premium costs and insurers’ financial stability when it comes to claim settlements. Conduct annual coverage reviews: As your business evolves, so do your insurance needs. The insurance market is constantly changing as well. Regularly review your coverage to ensure it aligns with your current requirements and avoid paying for unnecessary coverage or

Insurance is a complex realm where businesses can feel caught between a rock and a hard place.

assuming that existing coverage remains appropriate when circumstances change, or policy terms are adjusted. Insurance is a complex realm where businesses can feel caught between a rock and a hard place. Premiums can be significant, and in the current environment, they are increasing dramatically. However, not having adequate coverage can expose your business to severe downturns or even closure in the event of unforeseen circumstances. The key lies in striking the right balance by thoroughly understanding your risks, evaluating potential claim scenarios and assessing the impact that different coverage levels can have. By proactively managing your insurance needs, you can ensure optimal protection while maintaining a reasonable cost structure for your business.

Roylance Watson is a chartered accountant and associate at Vazey Child Chartered Accountants in Hamilton. Email: roylancew@vazeychild.co.nz Phone: (07) 838 5988 Website: vazeychild.co.nz

114  New Zealand Trucking August 2023

NZT 19 20


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Don’t put off your MAINTENANCE

2min
pages 122-123

LIVELY POLITICAL DISCUSSION HIGHLIGHTS ANNUAL CONFERENCE

3min
pages 120-121

Taking the pressure off the stresses of LIFE ON THE ROAD

3min
pages 118-120

What does ‘good’ look like for a TRANSPORT OPERATOR?

3min
pages 116-117

The rising cost of INSURANCE IN BUSINESS

2min
pages 114-116

The difference between BARRISTERS and SOLICITORS

2min
page 112

Servicing Cardan shaft park brakes

0
page 111

TAKING A BREAK

1min
page 110

Time to think about TIME MANAGEMENT

3min
pages 108-109

WHAT GIVES?

2min
pages 106-107

Education Engagement Programme

0
page 105

NZ TRANSPORT RECRUITMENT Getting the job done

1min
page 104

Ensuring road safety with BRAKE TESTING

1min
page 102

A Changing World Conference 2023

10min
pages 98-101

EVERY OPPORTUNITY

4min
pages 96-97

ROAD USER CHARGES

1min
pages 94-95

THE SALES NUMBERS

1min
pages 92-94

BUILD-AMODEL TRUCK COMPETITION

3min
pages 84-89

DOBBSY REVISITS CHURCHILL’S HEAD

2min
pages 82-83

RENO CALLING

2min
pages 78-81

LIFE LEFT IN DIESEL

5min
pages 74-77

JOINS THE ACTION MANUFACTURING FAMILY

1min
page 73

OUTBACK AND LOVING IT

6min
pages 70-72

SOARING LIKE AN EAGLE

1min
page 69

THE PENTHOUSE

1min
page 68

New Bodies & Trailers

2min
pages 66-67

FARM TRUCKING IN STYLE

6min
pages 54-57

Three Routes to Success

2min
pages 49-52

FORMAL RECOGNITION OF SKILLS IMPORTANT FOR TRANSPORT SECTOR

1min
page 48

PEDESTRIAN PROTECTION

0
pages 45-47

TRUCKING SECTOR PULLS THROUGH FOR BIRTHDAY BOY OLLIE

1min
pages 44-45

A DAY TO ENJOY K

3min
pages 40-43

WHEN IT’S ANYTHING BUT NORMAL

6min
pages 34-38

A Kiwi OEM

3min
pages 31-32

BUILDING AN RH

3min
pages 30-31

LIKE FATHER, LIKE SON

5min
pages 28-30

BACK TO THE FUTURE

12min
pages 20-28

Iveco Group takes full control of Nikola Iveco Europe

0
page 18

New simulation truck driving course to help stem driver shortage

1min
page 16

Registrations for KW100 live

0
page 15

Transporting New Zealand unveils diversity toolbox

1min
page 14

NRC teams up with Little Trucker Down Under

1min
pages 12-13

Scania NZ expands sales team

1min
page 11

Transporting New Zealand celebrates industry at awards night

2min
page 10

Pūhoi to Warkworth motorway finally opens

2min
page 9

CONSTRUCTION CREW.

3min
pages 7-8

BUILD NOW, PAY LATER

3min
page 6
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