Just Say No to Insurance Price Comparison Websites
According to a leading insurance broker, price comparison websites should be prohibited from offering quotes to small construction companies. Price comparison websites have become a popular option for choosing insurance cover by contractors like independent builders, roofers, plumbers and electricians in recent years as they strive to get the best deal available at the best price.
However, according to Mark Herbert, Managing Director of Construction Insure, more than half of all UK contracting companies do not have adequate insurance cover and he’s blaming aggregator price comparison websites for this. In fact, Herbert has called on Housing Minister Dominic Raab MP to introduce legislation to ban these aggregators from offering insurance to contractors in the construction industry. He believes that a change in the law is necessary to prevent independent contractors from being seduced into choosing cheap insurance deals which may not cover the work they undertake for their customers.
According to Herbert, if a contractor does not have adequate insurance cover, it may present a serious risk to all parties involved in a construction project. With many small building firms and tradespeople operating as sole traders, rather than as limited companies, if they were to be sued for inadequate work and discovered that they are uninsured (or underinsured), it could not only lead to the loss of their business, but their home and other assets too.
So many small building firms and independent tradespeople underestimate how important insurance is and visit comparison websites looking for a cheap quote which will provide them with an insurance document that can be presented to customers as proof of insurance. However, there is a reason that these insurance policies are so cheap – the small print will be filled with caveats and the policy will only provide the bare minimum level of cover which is not usually adequate for the type of work the contractor carries out on a day to day basis.
It’s recommended that all small construction companies take advantages of the services of a commercial insurance broker to find the right insurance policy to suit their company. A commercial broker has a deep understanding of the insurance market and the knowledge and experience necessary to ask the right questions to find out the exact nature of your work in order to offer an insurance policy that genuinely covers your company and protects you as a contractor. They will take the time to speak to each client and gain all the information necessary to help provide insurance cover that is tailored to your individual business requirements.
With construction contractors in Britain required to carry out extremely technical works such as piling and underpinning, roofing works and loft conversions, there is no one size fits all solution when it comes to insurance policies. Nobody wants an amateur builder working on their home, so no professional builder or contractor should want an “amateur” online aggregator advising them on an insurance policy.
Next week we’ll be taking a more detailed look at construction insurance and bring you some advice on how to choose the best for your business. Don’t miss out, you can follow us on Facebook or Twitter and get a heads up when the article is published.