Due to decreasing competition in the construction insurance market today, it could be fair to say that premiums are less competitive than they used to be. There are also factors that can push your premium higher such as your credit history, your experience in the industry, the amount of cover required or the location and size of your project.
An insurance policy such as Contractors All Risks Insurance is considered a necessity for covering types of risk such as accidents, damage, theft or third-party damage, although the following pointers should help you to avoid paying unnecessarily high premiums for complete coverage on any construction insurance policy:
- Shop around
By comparing prices from multiple providers, you can weigh up the total costs and total cover of various policies and choose the policy that is best suited for your circumstances. Compariqo can help you by obtaining a number of quotes from our panel of insurance providers. Our independence and transparency mean that you will be presented with all the facts so that you can make an informed choice.
- Review your Workplace Safety
Safety onsite is paramount and it’s important to emphasise this across the workforce as a number of claims can also affect your policy premium upon renewal. To enforce safety onsite, you can create a risk management plan to include:
- Safety training initiatives for all workers
- Investment in onsite equipment that promotes safety (such as robotic lifting machines, or protective wearables)
- Minimise hazards to your site
- Invest in a security system to protect against theft
- Strictly enforcing safety regulations onsite
- Periodically review your policy
When it comes to renewing your policy, make sure that the policy cover reflects your current circumstances. You may have added extra covers (for suppliers or sub-contractors for example) that you needed at the time but now no longer need. By choosing only the relevant cover, you may be able to trim some off your premium.
- Increase your deductibles
You need to be sure that you’re comfortable with assuming some extra risk here, but you can reduce the amount of your premium by increasing your deductibles. This is the excess amount on your policy that you would have to pay in the event of a claim before the insurer settled the remainder of the claim amount.
Be careful about raising the excess amount too much, as there is no point in taking out insurance cover if you may end up having to pay out a large amount yourself in the event of a claim.
Pay the Entire Premium Upfront
Even though your insurance policy can be paid in instalments, most insurers offer a reduced premium for paying the entire amount upfront (as they reduce their risk and increase their cash flow), so you can benefit from a healthy discount.
It’s important not to cut corners when choosing construction insurance. With the example of Contractors All Risks (CAR) insurance, its purpose is to provide cover in the event of an accident and protect against third-party liability. Look at the claim settlement ratio of the company, as it’s worth paying a bit more for a company that proves a high claim settlement ratio. There are other ways to save money in a business, but insurance isn’t one aspect where cheapest is necessarily best.
Looking for a quote on construction insurance? Contact Compariqo and we’ll research the market on your behalf.