Many home insurance policies automatically include cover for frozen food insurance. This cover is usually provided for a set monetary limit, for example £500.
Business insurance policies, even those for restaurants, cafes and takeaways, don’t automatically include this cover.
What cover is provided?
A business insurance policy usually has the option of adding cover for business contents, computer equipment and stock.
The stock section of the policy, will provide cover if there is damage caused by a specified cause, such as theft, flooding or a fire.
A contents section doesn’t usually provide cover for damaged stock caused by:-
- changes in temperature due to damage or a fault in the refrigeration machinery
- failure of the electricity supply
- leakage of refrigerant fluid or gas
This section of cover can be called frozen food insurance or deterioration of stock insurance, depending on the insurer.
What are the usual exclusions?
As you’d expect, the older the refrigeration equipment, the increased likelihood that there may be a breakdown. For this reason insurers apply different exclusion, or conditions, depending on the age.
This can vary from:-
- certain insurers excluding claims for equipment over a certain age, say five years.
- certain insurers insisting that a maintenance contract is in force, even for equipment under five years old
- other insurers having less onerous wordings, where they only insist on maintenance contracts on equipment over ten years old
How is frozen food insurance provided?
As we’ve mentioned above, most business insurance policies have a section of cover for contents. If you need cover for deterioration of stock, a separate section of cover will need to be added. Please do not make the mistake of assuming that cover is included in your quote. If you cannot see it specified, please review with whoever provided the quote.
Should I use a business insurance broker?
Clark Thomson are Chartered Insurance Brokers, as you’d expect, we’d always recommend using a broker. The question is, why should you do this?
As well as a broker, there are a few other options for obtaining quotes. These vary from, using a site offering to compare business insurance or going direct to a commercial insurance company.
The benefit of using a broker, is that we are able to offer the best cover at a competitive price, based on your insurance needs and wants.
If you go direct to an insurer, you’ll only be offered one company’s products. If you go to a comparison site, they’ll promote the cheapest quote to you. This does not necessarily mean the best cover.
Using the examples above, you may get a cheaper quote from one insurer, but this may contain a condition relating to the maintenance contract. You may be saving £50 per year, but you have to set up an annual maintenance contract for your refrigerated equipment. As you can see, the cost saving on one hand is swallowed up by additional expenditure on the other.
What are the approximate costs?
Every insurer has their own way of calculating a business insurance premium. However, based on our knowledge of the market, you should expect to pay around £25 per annum, for £1,000 of cover.
If you’re looking for a new business insurance quote or an alternative to your current business insurance renewal, please call or email and we’ll look to obtain quotes for you.