Canberra Business Chamber’s recent ‘Business Beat’ publication highlighted a series of difficulties currently being faced by local businesses. Amongst these, rising insurance costs were highlighted, with a particular significance placed on rising Workers Compensation premiums. The ACT can be one of the most expensive jurisdictions in Australia, however, there is an easy to miss silver lining – there are multiple insurers to choose from, and your broker should have an open line of communication with all of them.

Traditionally, Workers’ Compensation claims were primarily focused on physical injuries sustained in the workplace. However, the emergence of costly, complex and unprecedented volume of non-physical claims have underscored the need for a more holistic approach that includes mental health and risk mitigation to compliment a business’ overall risk management strategy. Insurers are now factoring in the costs associated with mental health claims, leading to an upward adjustment in premiums. This shift necessitates a proactive approach from businesses to manage these new risks effectively.

It may be tempting to try and look to reduce coverage on your general insurance to save costs. We can appreciate that in certain circumstances, this may be the only viable option, however we’d like to ensure that business owners understand that this option should be relied upon only as a last resort. Insurers and brokers are aware of the difficulties our current environment presents, addressing affordability concerns is a high priority across the board.

You may already rely on your broker to obtain the best premiums on your behalf, to provide advice on your exposures and the cover you may need, as well as advocating for your best interests when claims arise. It’s time to shift the approach from a reactive to proactive one. Your broker will want to work with you to understand your business, the risks involved and to help you build strong foundations with a core focus on mitigation, prevention and effective management of claims.

Your broker should have the resources to provide access to risk management consultants who can help fortify your business, to ensure best practices are understood and implemented. Should such resources be utilised, your broker can then leverage your sophisticated risk management framework to insurers to ensure that your premiums and claims outcomes are as fair and favourable as possible.

A robust risk management program can and should run alongside your insurance program. Not only to help drive down costs, but to help your broker to act in your best interests should a claim arise. Being able to present your business as a mature, risk averse environment and organisation helps your broker to advocate for the best possible outcome for your business.

These steps also help you to avoid claims from occurring. This is an easy point to miss, there is no better outcome than paying for insurance that you never have to use. If you can avoid a catastrophic loss or an injured worker, you will also avoid the losses insurance can’t cover. Stay in touch with your broker, ask questions and trust yourself to learn the processes. The more you know, the more effectively you’ll be able to work with your broker to minimise the negative impact that insurance premiums may be having on your business.

For more information on this, feel free to reach out to either Andre Ferreira on 0488 097 855 (Andre.Ferreira@ajg.com.au) or Ceshton Hanns on 0407 029 722 (Ceshton.Hanns@ajg.com.au).