Getting insurance right

The scenario

Charlotte, AOP member

“I am an optometrist and have owned my own practice for eight years. Every time my practice insurance renewal comes through, I contemplate shopping around, but I always run out of time. As a result, I have had my policy in place since opening. I want to make sure that it is still the most appropriate, but where do I to start?”

The advice

Paul Short, head of commercial development at Lloyd & Whyte

Anyone involved in running an optometry practice understands how it feels to be pushed and pulled between different responsibilities. Insufficient insurance, though, is almost as dangerous as no insurance at all. When trying to protect your business, there are a number of things to look out for.

In 2018, 38% of practice insurance claims made to Lloyd & Whyte by AOP members were for theft. With pocket-sized stock, often with designer labels, it’s easy to see how optometry practices can suffer such a loss.

With the summer months now upon us, an influx of designer sunglasses come into your practice. But have you ever considered how this seasonal difference affects your practice’s sum insured for stock?

If you’re reviewing the value of your stock, it’s a good chance to take a look at the rest of your practice’s insurance cover. Here are our steps to reviewing your insurance properly:

1. Avoid going under

One of the biggest reasons an insurer will pay less in a claim than you expect is due to underinsurance. In order to get the right content sum insured, calculate how much it would be to replace items room by room. Taking into account the cost to replace equipment based on “new for old,” what would it cost to kit it out from scratch?

If you own the building from where your business operates, the best way to get an accurate sum insured is to have a property survey. This can be done onsite or remotely. A remote survey, known as a desktop valuation, is more cost effective than an onsite survey and should be considered as a guide rebuild cost.

To make sure your business is properly protected, we recommend annual insurance reviews with a qualified adviser

2. Have insurance fit for your practice

As mentioned, the summer can mean you may have extra valuable stock in your premises. Some insurance policies will account for this and include a ‘seasonal uplift.’ When reviewing your practice insurance, check when an uplift does apply; you’ll want it to tie in to when you receive new additional stock.

3. Consider how your business has changed

Has your business grown in the past 12 months? Have you invested in new equipment, or made any renovations to your clinic rooms? Have you had any change in legal structure and/or partners? All of these elements will impact on a number of your businesses’ insurance policies. You have probably reviewed your insurance with significant changes, such as change of address, but it’s easy to overlook smaller adjustments such as changes in security measures or investment in equipment.

4. Prepare for a digital threat

Research shows that 55% of UK businesses faced a cyber-attack in 2018 (BBC News). As a business that captures records and processes sensitive medical information, optometry practices have an obligation to their patients to do their best to prevent and prepare for a cyber-attack. Cyber insurance can help a practice with the costs incurred in the event of an attack. Visit our website for resources, including a self-assessment form and details about cyber-attacks on healthcare practices.

Being able to support your staff while they’re ill is paramount for employers. However, the cost to a business can quickly mount up

5. Count the cost of illness

Recent research from the Chartered Institute of Personnel and Development (CIPD) has established an increase in ‘Presenteeism,’ the attendance of people at work while suffering with health problems (CIPD 2019). Being able to support your staff while they’re ill is paramount for employers. However, the cost to a business can quickly mount up; whether it’s extending opening hours to accommodate patients, hiring a locum or paying overtime.

A Locum Insurance policy can cover the costs of such staff absence, without you needing to prove your expenses when making a claim. You can choose how much cover you need for different members of your team, so you know how much you would receive

Find the time to do it justice

While nobody sets out to ignore their insurance requirements, the pressures of running business means dealing with insurance is probably far down your to-do list. To make sure your business is properly protected, we recommend annual insurance reviews with a qualified adviser.

Setting aside an hour each year to talk to an expert will save you time in the long run, as well as give you the peace of mind insurance is supposed to provide. Sometimes, there is nothing like having a face-to-face conversation with someone about your business. It also gives you the opportunity to ask questions that might otherwise take weeks to get answered.

We offer complimentary commercial insurance reviews to AOP members. We review your policies, identify any gaps and make practical recommendations to better protect your business. Visit our website for more information or call us on 01823 250700 to arrange a review.

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