The contents sum insured (excluding stock)should reflect the total value of machinery, plant, equipment, furniture, shelving, racking and all other contents at the insured’s premises. Stock items are the goods or products sold by a business in order to generate revenue. The stock sum insured should represent the value of all stock and materials in trade belonging to the insured, or for which they are responsible. The stock sum insured should reflect the cost to the insured to replace the items and not the retail price. When setting the sum insured, consideration should be given to the maximum value at risk during seasonal or other peak trading periods
If you’re a stock holding business, you’ll find that stock is the Life-Blood of your business, as without it there can be no sales and without your sales there is no income, so ensuring your stock and in turn your income is a critical step you won’t want to neglect. Depending on the type of business you’re in, you could well have a wide array of products held as stock with these at constant risk from unforeseen disasters such as theft, flooding or fire.
Stay up to date
Are you regularly reassessing your businesses needs during the lifetime of the policy and at time of renewal? Think has your stock or stock levels changed? For example you may have introduced a new line of products. Are you buying in more stock, or less?
Consider how your business might have grown since the policy started, if you’re now doing considerable more business this can have a knock on effect within your business in terms of your stock and contents.
Perhaps your business has changed in terms of the different services you offer, perhaps you started off in a shop and now require insurance to cover deliveries as well. Or perhaps you’ve moved from a home office to a dedicated retail unit. In both cases those types of changes would not be covered under the current policy and would require an update to the policy or a new policy in entirety. You should be vigilant and regularly be aware of any changes to your business and what affects these could have on your current insurance coverage.
The Insurance Act 2015
Importance of getting your sums right
Calculate Business Interruption Insurance
Calculate sum of buildings cover
Calculate stock and contents
How much are your business equipment, Plant and tools really worth?