When peace of mind matters!
In an effort to assist insurance brokers, authorised representatives and Insureds set the Sum Insured/Declared Value correctly, the LMI Group started offering a tailored business interruption review service in 1999 through their specialist division, Risk Management International (“RMI”).
Since that time, four businesses for which we provided a full review suffered a significant loss. In only one of those cases was the Insured fully indemnified! In the other three claims, the amount received by the Insured was reduced due to a penalty imposed due to under-insurance. As you can imagine, this set alarm bells ringing. Were we missing something?
A thorough review quickly identified the problem. The claims had occurred in the first, second, third and fourth year following our review. In the one case where the loss occurred in the same period of insurance as RMI’s review, the insurance program was correct and there was no adjustment for under-insurance applied. This is the way it is supposed to work!
In the other three cases, despite our report showing the past and expected growth in the business (in one of these cases, in excess of 20%), the sum insured had not been increased at any renewal since our review. The longer the period since the review, the higher the penalty for under-insurance due to the compounding effect of ‘growth on growth’.
To reduce the effect of this, RMI developed our Platinum service. This service includes a full business interruption review with sum insured/declared values being accurately calculated, as well as a thorough review of the wages cover, the Indemnity Period, Customers’ & Suppliers’ Premises, and all the other extensions/endorsements available.
The Insured and their adviser are provided with a detailed written report, together with a calculation template tailored to their business (built in Microsoft® Excel). Other services, such as Business Continuity Management, may also be explained.
On the third renewal, RMI notifies both the Insured and the intermediary, recommending that a full review be carried out. The Platinum service is designed to ensure that the many changes that can occur to a business over a 3-year period are captured and reflected in the insurance program. In dynamic businesses, more regular reviews are necessary.
For a brochure on the Platinum service, please click here