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How do insurance claims work for business owners?

Insurance is an investment most business owners hope they’ll never need to use. 

If you lodge a claim on one of your policies, understanding how the system works can make the process smoother and less stressful. 

These are some of the important actions you’ll need to take. 

Initiating the claim 

The first step is notifying your insurer as soon as possible after an event. There are many ways you can do so – through your broker, over the telephone, via their website, or using the company’s mobile app, if it has one. 

Providing information 

It’s helpful to have all the necessary information to hand when you contact your insurer – your policy number, details about the incident and any documents your insurer will likely request. 

The more information you can provide about the incident or event, the more likely it is your claim will be resolved smoothly and quickly. That’s why it’s important to collect as much evidence as possible. Depending on the nature of your claim, your insurer might want to see photographs, videos, proof of purchases or police reports. 

“You may lodge a complaint with your insurer if you disagree with the reason provided”

Awaiting assessment

Once your claim has been lodged, your insurance company will allocate it to a claims assessor. It’s their job to determine whether you are eligible for a settlement and, if so, what that settlement should comprise. 

As part of the process, they may send an insurance loss adjuster to inspect any damage to your premises or property. They’ll also review the documentation you provide to determine whether your policy covers the claim. 

Accepting the settlement 

If your claim is accepted, your insurer will offer you a settlement in accordance with the terms of your policy. This could entail repairing or replacing damaged property, reimbursing expenses or providing financial compensation for your losses. 

If you are happy with the settlement you’ve been offered, you’ll be asked to formally accept it by signing a settlement offer. Once you’ve done so, your claim will be finalised. This means your insurer will take whatever actions have been agreed upon in the settlement. 

Contesting the settlement 

If your insurer offers a settlement you’re unhappy with or refuses to pay your claim, the insurer hopefully will let you know why. 

For example, the insurer may say that the incident in question wasn’t covered by your policy, or your premium wasn’t up to date. 

You may lodge a complaint with your insurer if you disagree with the reason provided. Your claim can then be reviewed by another employee with the power to make a decision. 

If you’re unhappy with the outcome of this internal review, you may be able to lodge a dispute with the Australian Financial Complaints Authority. It will review the case and make a decision which is binding on the insurer. 

How your insurance broker can help 

Making an insurance claim can be stressful and time-consuming. 

That’s why it pays to enlist the help of your insurance broker. They can support you through the process, liaising with your insurer and advocating for the right outcome. 

Having them on your team can help you obtain a smoother, speedier settlement. 

Cover when it counts 

A broker can help you determine whether you have the right insurance to help safeguard your business and its assets against damage, disruption and loss. 

If you’d like to learn more about their services, contact your broker today. 

Important notice 

All information in this article is of a general nature only and does not take into account your specific objectives, financial situation or needs. Deductibles, exclusions and limits apply to insurance. Cover can differ between insurers. 

This article provides information rather than financial product or other advice. The content of this article, including any information contained in it, has been prepared without taking into account your objectives, financial situation or needs. You should consider the appropriateness of the information, taking these matters into account, before you act on any information. In particular, you should review the product disclosure statement for any product that the information relates to it before acquiring the product. 

Information is current as at the date the article is written as specified within it but is subject to change. BICS make no representation as to the accuracy or completeness of the information. Various third parties have contributed to the production of this content. All information is subject to copyright and may not be reproduced without the prior written consent of BICS.