Life is full of risks. We’re aware of some of those risks and ignore others. We spend lots of time focusing on certain types of risks, such as a new marketing campaign, changing suppliers and altering our business strategies. These risks hold our attention because we have a degree of control over them – our actions and decisions influence the outcomes. We know our actions will have consequence and we know we can handle any minor bumps along the way.
There are also other kinds of risks that are uncomfortable to think about, such as being sued, losing stock, or severe damage to our business premises. These risks are uncomfortable to think about because of the potentially severe consequence for our businesses and our livelihoods.
What’s more dangerous is that we rationalise the decision to ignore these risks. We tell ourselves that, “Our equipment will never falter,” “our customers would never sue us,” and “our employees will never get hurt in our warehouse.” The reality is that these things happen to small, medium and large businesses in New Zealand every week. What’s important is to ensure they don’t cause your business be placed in a dire situation.
Humans are natural optimists, so you can’t blame us for falling into these patterns of thinking. But we must make allowances for this cognitive bias. Even if something is unlikely to happen, you must not ignore the potential issue. First, you must ask yourself this one question – if this unlikely event does happen, are the consequences so severe that my business could lose significant profitability or even fold? If the answer is yes, then you need to consciously pay more attention to that problem.
The Minimum is Never Enough
One pattern of thinking many business owners resort to is – I purchased some general business insurance, if anything bad happens, I’m sure I will be covered. Many businesses have found out the hard way that this is simply not true. Either a business owner didn’t consider a potential issue, bought the wrong insurance product, or a specific risk was excluded in the insurance cover.
To save businesses from this costly mistake, it is recommended they consult an experienced insurance broker. Insurance brokers are constantly aware of all the risks your business is facing – fire, theft, lost customers, supply issues. While you may ignore these issues because you’re focusing on your marketing campaign or testing out a new supplier, insurance brokers consider them for you.
An insurance broker from PIC Insurance Brokers will consider all the small risks that can have a huge impact on your business. You’re the experts in your business and your industry and we’re the experts in New Zealand business insurance. As a 100% New Zealand owned company, we ensure that all the appropriate cover is provided, including Business Assets & Property Cover, Business Interruption/Loss of Profits, Liability Cover, Commercial Motor, Construction, Corporate Travel, Marine Cargo, Key Person and Employee Benefits.
To find out more, visit our insurance page or call 0508 742 742 to speak with an insurance Broker.