BizCover launches a new website making it easier for Australian customers to compare and buy professional indemnity and business insurance online

Sydney, Australia – December 17, 2010. BizCover, the pioneer online insurance marketplace in Australia and leading provider of online professional indemnity insurance, has announced today the launch of its new website.

The new and improved portal has been designed to help the growing online shoppers’ community to compare, select and buy the right professional indemnity and business insurance in a more accurate, fast and user friendly manner.

“We understand how important having choice and saving time is for our customers, that’s why our new website has enhanced our already well-known features, such as the option to compare quotes from Australia’s leading insurers and buying online coverage in just minutes; with a very customer focussed interface that allows them to quickly access information and insurance coverage specifically designed for their occupation or business”, says Michael Gottlieb, Managing Director of BizCover.

BizCover.com.au is already renowned for providing quick and easy online professional indemnity and public liability insurance for over 200 professions. The new website enhances this offer by giving BizCover’s growing customer base of small businesses and trades the option of buying business insurance online.

“We have learned through our interaction with over 10,000 customers, that the online shopping community has evolved substantially and the apprehension of buying online is no longer a significant factor. On the contrary, customers are now expecting more from us, which is why we have introduced business insurance, and we are constantly adding new professions and verticals to our already comprehensive insurance offer”, adds Mr Gottlieb.

Although BizCover is constantly evolving and enhancing its services, its motto of providing quick and easy online insurance is still a very fundamental part of the business. This means customers can still get online coverage with no hassles, no forms to fill in and no delays on their policy documentation.

BizCover’s partners include Australia’s leading insurers, QBE, Chartis, Vero and DUAL. To get a quote for professional indemnity, public liability or business insurance, and get instant coverage, please visit: www.bizcover.com.au.

With the economy still being quite unsettled and business insurance being extremely high those businesses that carry Work cover insurance in WA received good news today. Due to a wage growth and fewer people making claims on WA has been able to lower their work coverage rate 14 percentage points to a new historic low of 1.49 percent.

This may constitute a considerable savings for some businesses that pay this kind of business insurance. Work cover business insurance is designed to help offset medical and lost work expenses to employees who are injured on the job.

What is even better news is that this new lower rate will apply to all but 37 of the 480 premium classes. However, what is good news for the majority of businesses in WA is not so good for the 36 categories of businesses which will see in a rise in their Work cover rates. The rise in rates for these businesses however is a reflection of individual industries performance.

The work cover business insurance rates have been declining in WA for some time so this new lower overall rate while welcome probably does not come as a big surprise. It does however make WA one of the areas that has a significantly low Work coverage rate placing right along side Victoria whose rate is 1.387% and much lower than the rate in SA of 2.75 percent.

While the lower Work cover rates are good news for employers it is also good news for the employees in WA as well. While employees do not receive any financial advantage from the lowering of these rates, the fact that work cover business insurance claims have been steadily dropping is at least an indication that most businesses and industries have a safer work environment than ever before. Less work related injuries to employees means less lost work time and a benefit to employees overall health.

The one exception to this seems to be Queensland where the work coverage rate is the lowest in Australia at 1.15%. While the businesses currently benefit from this low insurance rate the future may see these rates rising drastically in Queensland. By keeping the work cover rates low Queensland has incurred a consecutive debt of $800,000 which is due at least in part to freely approving claims with little investigation. While no one wants to see an employee refused benefits that he is due, approving claims without a through investigation could result in thousands of dollars spent on fraudulent claims that could bankrupt the system and result in rising worker cover insurance rates for businesses.

Critics are suggesting that Queensland take action to reform their work cover business insurance system. In the meantime businesses in areas such as Victoria and WA have been able to lower their rates, and save employers money on Work cover business insurance premiums without putting the system at risk. What is good news for the employers paying these lower premiums is also good news for the employees working in an environment where work related injuries are at a minimum. Proving that providing a safe working environment can be beneficial to all.

On one side of the coin, an early 2010 survey by PricewaterhouseCoopers (PWC) reveals that Australian detection of internal fraud has a higher frequency than anywhere else in the world. A third of the business insurance fraud is yielding losses of over $US1 million ($1.1 million). On the other side of the coin, Australian businesses have been uncovering insurance fraud in about 40% of employees. So, insurers who underwrite business insurance have to worry about fraud coming from two different directions. Some could come from within their own companies, while other sources could be those who want to rip them off.

It seems that the global financial crisis has motivated some employees to fleece their employers to the tune of millions of dollars. However, the increased detection of business insurance fraud in Australia may just mean that regulators and employers have become better at detecting it, instead of it being proof that more of it is going on now.

PWC forensic services partner Malcolm Shackell labels business insurance underwriters as companies which are exposed to “acute risk” of internal fraud. He says “I think that is a real risk and it depends on how the organisation is siloed.”

In addition to his other comments, Malcom Shackell says of business insurance fraud, “For most organisations [fraud risk] might involve payroll and accounts payable, but in insurance companies you’ve also got claims and that sort of thing. Internal fraud is still something insurance companies need to watch.” Shackell adds that the number of Aussie companies carrying fidelity insurance is amazingly low, too.

On the global scale, insurance fraud happens the majority of the time at the management level. Here, employees feel the pressure of retrenchment, lost bonuses, or elevated sales quotas. Management may be surrounded by diminishing staff, new product lines that are hard to sell because of low recognition, or just weak internal monitoring of their behaviour by the company.

Malcom Shackell further comments on increased insurance fraud detection in Australia. “Closer to home, another trend we saw was the detection of frauds that had gone on for a long time and had been committed by trusted employees, resulting in a larger financial and broader, whole of business impact.”

KPMG national head of forensic accounting, Gary Gill, says of the business insurance fraud epidemic in Australia, “I think what we are seeing in the courts is just the tip of the iceberg. I think we are seeing a few more people being caught due to the global downturn, which has made companies more diligent in looking for internal fraud, but the problem is still very serious.”

Part of any insurance policy is a section outlining what the insurer is not covering. Whereas the insuring clauses and policy extensions establish cover, policy exclusions strip specific areas of cover away. Because an IMI policy effectively combines three policies, there are several exclusions which should be considered. They include:

• Prior/Known Claims or Circumstances
• Criminal, Fraudulent, Dishonest or Malicious acts;
• Bodily Injury & Property Damage;
• Contractual Liability;
• Claims made in respect of Fees or Commissions;
• Insured vs. Insured – this however includes a write back for specific cover for Defence Costs; and
• Various exclusions in respect of Fidelity/ Employee Theft.

Important conditions of an Investment Manager’s Insurance Policy

Claims made and notified: The professional indemnity and directors & officers sections of an investment manager’s policy are issued on a claims-made and notified basis. This means that the policy only covers claims first made against an insured during the policy period and notified to the insurer in writing during the Policy Period.

Advanced Payment of Defence Costs: This vital clause can be either a condition or an extension of an IMI policy. When a claim is lodged against a Insured it is important to act quickly. This clause ensures that legal defence costs are advanced so that the entity, and its personnel can get on with the defence of the claim.

Some insurances policies impose conditions on advancement of such legal costs to restrict the amount that will be advanced. As such it is important that policies are clear and unambiguous as to the advancement of these defense costs.