Insurance in the construction industry now costs more than ever before. At Civils 2004 you can find out whether you are being ripped off.
Spiralling professional indemnity costs have crippled smaller firms in recent years as the insurance market has reacted to the 9/11 terrorist attacks on the US. 'The cost of insurance now is higher than ever, the level of cover has fallen and the amount of firms dealing with construction has dropped by a third, ' says Howden Insurance business development manager Matthew Reed.
Thankfully, there are signs that this assault on construction is levelling off. But despite the shake-up there are still consultants in the UK who like to keep all their insurance with the same provincial broker. That includes home, contents, dog. . . everything in the same bundle.
'But is the person that handles your car insurance the same person you want to handle your business' long term security?'
asks Reed. 'There is a lot of smoke and mirrors about the insurance market and if you are not involved with it daily, you will not find the best deal out there.'
Howden Insurance business development manager Andrew Bowyer insists the best way to get value for money is to use a Lloyds broker. 'This means you have direct access to the market, you cut out the middle man and means you are dealing with people who receive constant feedback from the market.'
Howden prides itself on this close contact with the market.
This flow of information back to the client has eased their concerns at hiking costs. Reed says:
'By explaining what is happening and why cover is changing - with plenty of notice - clients can better prepare and work to ease their own rises.
'We know of companies who have told their clients two days before a renewal is due that they can expect a 50% hike. This is simply not good enough and is entirely avoidable.'
And with this advance warning, firms can claw back a better deal. Number one priority is to develop risk management systems that greatly reduce the likelihood of needing to use insurance. 'By initiating management practices, firms can reduce their reliance on insurance and use it more as a safety net. This will help attract interest from the market if presented to it in the right way, and will generate substantial savings, ' adds Reed.