Business and Commercial Insurance Poilicies Can Give Your Business a Good Advantage if There Are Any Legal Issues or Claims against Your Company
Business and commercial insurance policies are something you purchase in advance, in the hope that you will never need to really use it. You purchase a policy that runs for one full calendar year. Generally , policies run from midnight to midnight. So, you buy a policy that starts on the third March 2010, it’ll expire at midnight on the following March 2011. For one reason or another, you’ll opt to cancel your business insurance policy mid way thru the insurance year. You can decide to stop trading, you’ll combine with another company or you can move grounds.There are many different types of small business insurance policies that you need to be aware of.
For all these reasons, it is completely valid that you decide that your present policy isn’t needed and you would like to cancel it. An policy is largely a risk transfer mechanism. You say to an insurance company that, for you paying them and yearly fee, that they’ll take some of your business risks , i.e. The chance of fire, burglary or flood or a employers, products or public liability. You have different options when paying for your policy. Typically it is one of 2. You either pay the premium completely in advance or you pay it in monthly payments. Either way, the insurers would expect in the twelve month period to get the full annual fee from you. Similarly , you would expect that if you cancel the insurance policy at any time in that 12 months they might return any unexpired portion to you.
Normally you would want this on a pro-rata basis. If you pay for 12 months and then cancel after six, you would expect to get six months back. sadly, this is not necessarily the case and you want to mindful of this when taking out your policy.
You can understand that if you want to lodge a claim on the policy in that year, then you need to be responsible to pay the full yearly premium. This is written into the terms of every policy. But, come policies do have a condition that if you cancel the cover, whether you have said or not, you have got to pay the full strike. These policies are called minimum and deposit and you have got to avoid them like the plagues. They typically apply only to combined liability or pro indemnity insurance some insurers, have them applied to all covers. They’re on the radar of the FSA as they feel, quite properly, that they aren’t part of their “treating clients fairly” philosophy.
