6th June 2003
Over 85% of small businesses in the construction sector are concerned about the impact of rising insurance premiums on their business according to research from Zurich's UK Commercial business.
This week both the Office of Fair Trading (OFT) and the Department of Work and Pensions (DWP) published their much anticipated reports into liability insurance. The National Federation of Builders welcomed the reports but said more immediate action was necessary to help alleviate the problem of escalating premiums.
Carl Gebhard, Construction Manager for Zurich's UK Commercial business said : "The most important thing that the construction industry can do to control premiums is to invest in and manage health and safety within the business. With many potential hazards, good risk management is an essential tool for all companies. The insurance industry is becoming more sophisticated in terms of risk selection and companies need to demonstrate what measures and controls have been implemented to minimise the potential for accidents"
Results from the insurer's Small and Medium Sized Enterprises Index, which monitors confidence levels amongst small and medium sized enterprises on a quarterly basis, also revealed that other industries which expressed concern over rising insurance premiums were mining (79%), transport (78%) and retail 70%).
Zurich is urging brokers to support businesses within the construction industry and has the following top tips to for brokers with clients in the construction sector:
1. Give your client advice about managing risk in the business - there is a lot of valuable information available from the HSE.
2. Advise them about vetting their subcontractors to make sure they work to a high standard and let the insurer know how they are managed on site. Check their insurance is renewed including terms and conditions and what control processes are in place.
3. Advise them about what to do in the event of an accident and help them to draft a procedure that must be followed in the business.
4. Provide the underwriter with as much information as you have on Health and Safety and anything they do to prevent accidents within the business
5. Explain to the underwriter in detail what the client does, providing examples of recent projects and split the wages and turnover by activity
6. Know your client - if they don't do some hazardous activity anymore let the underwriter know.
7. Give details on any large losses and how they will be prevented in the future
8. Advise what precautions, processes and measures have been implemented to improve the risk.
9. Help your client with compliance with Health and Safety regulations
10. Ensure that all training and Health and Safety procedures are documented.
