Archives for October 2011

Britain’s Postcode Lottery for Home Insurance

Thirty-27: Lucky?

Homeowners across Britain are experiencing differences to their home insurance premiums and it all seems to be based upon which postcode you live in.

Data from MoneySupermarket.com’s Home Insurance Monitor, compiling nearly 3 million home insurance quotes from summer 2010 to spring 2011 has found which areas are the biggest winners and which areas are the biggest losers when it come to home insurance premiums.

 Homeowners lucky enough to live in Jersey, South and East London and Norwich are enjoying the biggest reduction in their premium costs. Jersey saw the biggest reductions with their premiums being cut by 13% followed by South and East London with both areas enjoying a 7% reduction and Norwich 6%.

But why are these areas experiencing such decreases when other areas of the UK are having their home insurance premiums increased?

Julie Fisher, head of home insurance at MoneySupermarket.com explains: Our research shows some areas have seen more of a decrease in the cost of their premiums than others. Unfortunately, postcodes can dramatically affect how much people pay for their home insurance premium. For example in Jersey, one fifth of the population is retired, and low crime rates coupled with mild weather conditions means that the cost and frequency of claims are likely to be lower than other areas of the country. East London is undergoing significant regeneration and infrastructure improvements and insurers may be adjusting premiums as a result.”

Here is a table to show the 10 postcodes which saw the biggest decrease to their home insurance costs:

Postal Area Region/City Summer 2010 Spring 2011 Change from Summer 2010 – Spring 2011
JE Jersey £148.38 £129.71 -12.58%
SE London SE £180.07 £167.43 -7.02%
EC London EC £147.80 £137.65 -6.87%
NR Norwich £134.12 £125.69 -6.29%
DT Dorchester £143.71 £135.10 -5.99%
EX Exeter £137.80 £130.48 -5.31%
LE Leicester £150.82 £142.92 -5.24%
IM Isle of Man £147.00 £140.00 -4.76%
WS Walsall £146.47 £140.30 -4.21%
CW Crewe £153.30 £147.00 -4.11%
         

Data sourced by MoneySupermarket.com

In contrast some areas are experiencing a large rise in their premiums, with Jersey’s Channel Island neighbours, Guernsey experiencing the biggest rise of 32% with Orkney and the Shetland Islands following with 21% and 20% respectively. But what, you might ask, are the reasons for this? Julie Fisher continues “In the case of Guernsey, Orkney and The Shetland Islands, home insurance cover in Summer 2010 was lower than the national average premium price. It is likely that insurers have brought these prices in line with the rest of the country, rather than responding to any specific ‘occurrences’ on these islands, although climate may play a part.

Other areas that experienced an increase to their home insurance include Llandrindod Wells, Stevenage and St Albans, Julie Fisher explains possible reasons for these increases “If your property is classified as being in a ‘high-risk’ area – whether for crime, flooding or even fraudulent claims – it will be reflected in your home insurance premiums. Living in a more affluent area will also increase premiums as property and contents values will generally be higher. Insurers use postcodes as a part of the overall risk factors when calculating premiums. Although there is very little you can do about the postcode in which you live, except move house, there are steps you can take to reduce your premiums, such as, installing a good home security system and security lighting.”

Here is a table to show the 10 postcodes which saw the biggest increase to their home insurance costs:

Postal Area Region/City Summer 2010 Spring 2011 Change from Summer 2010 – Spring 2011
GY Guernsey £119.73 £158.33 32.24%
KW Kirkwall £125.22 £151.58 21.05%
ZE Lerwick £131.78 £158.27 20.10%
LD Llandrindod Wells £127.69 £144.13 12.87%
SG Stevenage £140.29 £153.77 9.61%
AL St Albans £154.43 £168.03 8.81%
TF Telford £137.86 £147.00 6.63%
DA Dartford £161.29 £171.48 6.32%
SS Southend-on-Sea £171.66 £181.42 5.69%
CA Carlisle £139.54 £147.00 5.35%

 

 

Creative Commons License photo credit: LulaTaHula

Set Up as a Sole Trader

TraderstoneyFAN

Setting up as a sole trader can be the simplest, and most rewarding, way to run a business. You won’t need to pay any registration fees and it’s straightforward to keep accounts and records. Most importantly, however, you get to keep all the profits. You will be on your own though, so it’s you alone that needs to make sure you are up to date with all legal requirements and have the appropriate business insurance in place. It’s also not without its risks as you’ll be personally liable for any debts that your business runs up, which can therefore make it a risky option for businesses that may need a lot of investment.

Raising finance

You’ll need to raise the money to get your business off the ground, by using your own assets and/or with loans from banks or other forms of lenders. This can be an extremely daunting prospect, so make sure you go in with a full business plan, get the amount you need to borrow right from the outset, and treat negotiating for money with the same passion and tenacity as you would do when trying to make a sale.

Business Insurance

While operating your business as a sole trader you’ll still need to ensure you have appropriate business insurance in place. In most instances this will be either public liability or professional indemnity insurance. With that in mind it’s worthwhile to seek professional advice on which is the most appropriate insurance for your business needs.

Tax and National Insurance

When setting up as a sole trader, you’ll be self employed, which means:

  • Your profits are taxed as income
  • You pay fixed-rate Class 2 National Insurance contributions (NICs) regardless of any profits you make
  • You pay Class 4 NICs on any profits
  • You need to register for Self Assessment and complete a tax return each year

Records and accounts

It is imperative that you keep records showing all your business income and expenses. When starting off it may be advisable to get in touch with a professional accountant who can provide you with all the details on how to keep your accounts professionally maintained and up to date.

Liability

One of the biggest factors to take into consideration when setting up as a sole trader is that you are personally responsible for any debts that are run up by your business. In reality, this means that your home or other assets may be at risk if your business runs into trouble.

>Creative Commons License photo credit: kylemac

Landlords Don’t Forget the Insurance!

Sunny Room in old Apartment
Creative Commons License photo credit: epSos.de

If you’re letting out a property you’ve a lot to think
about, you’ll probably be decorating, doing some DIY, making sure the property
adheres to safety standards and fulfils all regulations. You’ll be thinking
about contracts for your tenants, you’ll be trying to find the perfect tenants.
There’s an awful lot to think about, but the one thing you must not forget, is
to get Landlord Insurance. Even if you already have the property insured with a
standard home insurance policy, it isn’t sufficient when you have tenants in
the property. You won’t be covered, as the policy will be invalid.

There are some additions with landlord insurance that you
won’t find in a standard home insurance policy. The needs of a landlord are
quite different from those of a homeowner occupying their home, and the
Landlord Insurance policies reflect this.

Of course you’ll need Landlord
buildings insurance
, to cover structural damage. This is similar to your
standard home buildings insurance, covering you for floods or fire etc. but you
may also have additional cover for malicious damage. If a tenant vandalises
your property on purpose then you can file a claim. Your buildings insurance
should also include permanent fixtures such as fitted kitchens, wardrobes and
bathrooms.

Landlord
contents insurance
will cover you for any furniture you have in the
property, this may include carpets and curtains and white goods, but do check
your policy details careful to make sure all your items are covered. It is
however unlikely that your landlord insurance policy will cover your tenants
belongings. Check this and let your tenant know if they need to arrange their
own contents insurance for their possessions in the house.

Some landlord insurance policies will include Rent Guarantee
Insurance. This type of cover comes into play if a tenant perhaps refuses to
pay the rent, and may even cover you for your property being empty between
tenants. If you have a lot of outgoings on the property such as mortgage
repayments, this might be a useful addition for you.

Legal Cover and Liability Insurance can also be very useful.
You will be covered if a tenant is hurt, injured or becomes ill in your
property because you have failed to maintain something properly. This could be
a fall down stairs due to a rotten banister, or sickness caused by carbon
monoxide poisoning from a gas fire that hasn’t been properly checked. You would
also be covered for taking a tenant to court or having them evicted.

Reduced the cost of insuring your modified car

Porsche 911 Carrera S Techart
Creative Commons License photo credit: Ed Callow [ torquespeak ]

Despite what you may believe about the insurance costs associated with modifying your car, vehicle owners are actually able to offset the recent car insurance price hikes (especially when it comes to modified car insurance). By using comparison sites to compare car insurance and get the best deals going, modified vehicle owners are able to take full advantage of the huge savings available online with those various insurers which are happy to offer modified vehicle owners a fair price.

Any motoring enthusiast who chooses to modify their car can usually expect to suffer a massive hike in their insurance premium. Everything ranging from getting tinted windows to installing an in-car phone or getting a good-quality set of hubs will affect the cost of car your insurance. Take, for instance, the study commissioned relatively recently by one of the UK’s primary price comparison websites, moneysupermarket.com.

If you’re thinking of installing a body kit, then you may think again when you hear that it can increase your premium cost by up to 101 per cent. The main way of making significant savings, says the comparison site, is to compare car insurance quotes using its car insurance comparison tool – naturally.

But, despite what you may think is mere hype, these sites really are pretty good at seeking out the best-value deals, and saving you a hell of a lot of time in the process. But apart from just this, are there any other practical tips you can implement to keep your modified car insurance costs down?
It’s extremely important that you keep your insurer fully up-to-date with any modifications you make, immediately, because not to do so could well see your policy invalid and you in a whole lot of trouble.

Increase security
If you have a garage or driveway, make sure you use it and tell your insurer. Add an industry approved immobiliser, alarm and tracker to your car too, and you’ll cut a chunk off the price of your premium.

Pay annually – Paying an annual lump sum as opposed to in monthly instalments will save you anywhere between 10 and 20 per cent. And if you don’t think you’d be able to do this, get yourself a credit card that offers 0 per cent interest on new purchases or a 12-month interest-free period.

Add another driver – if you’re a younger, less experienced driver, it’s a good idea to add an older, more experienced one to your policy to bring down the cost. However, don’t name them as the main driver if they’re not – this is called fronting, is considered fraudulent and is highly illegal.

Take the Pass Plus test – Costing between £125 and £160, this can reduce the cost of your insurance by as much as 30 per cent, and once you have it, that’s it – no extra costs. While it has indeed been devised to help newly-qualified drivers, any driver can take it at any point of their driving career.

Don’t claim for every little thing
Every year you don’t claim on your insurance, you’ll qualify for a no-claims discount, and once you hit the five-year marker, you’ll save up to 65 per cent – which you can protect, meaning that you’ll be allowed to claim once or twice before your bonus is rescinded.

Reduce your mileage estimate
When you insure your car, you’ll be asked to give a good estimate of the annual mileage you’ll expect to do in the year ahead. If you overestimate, you’ll end up overpaying for mileage that you simply won’t use. Be conservative, and if you think you’re going to go over the mileage you originally stipulated, don’t forget to inform your insurer immediately.

Picture from flickr user: nazly

Salon Insurance (hairdressers, beauty, nail bars)

receiving transmission
Creative Commons License photo credit: muitosabao
There are few industries that rely upon recommendation and word of mouth more than hairdressers and beauty salons.

Should the worst happen, if you were to cause physical injury to a client or, worse, be burgled and not be able do that perm in time for Thursday afternoon bingo, and you were unable to compensate your clients, your business would be, like the neglected hairdo, in tatters.

Like hairdressers and beauty salons, nail bars and tanning shops provide the base for industries that rely heavily on human contact, both physically and in the psyche; it would be foolish to entertain such a venture without being adequately insured.
Salon Insurance should be the cornerstone of your cover and should protect financially you from many of the more common risks, such as general wellbeing within the salon and safe premises.

And, if you are not an independent trader or freelance beautician or hairdresser, you will need Employers Liability Insurance so that your staff can work safely and you’re secure in the knowledge that, should they injure their selves whilst carrying out their duty, you are covered, too.

Other general policies should not be overlooked. Your Buildings Policy is a must if you own the salon or shop – without that you have no business; and in the same breath, ensure that you can cover salaries and your own livelihood in the case of business interruption in light of a concurrent claim.

Applicable to both mobile and static businesses within the beauty industry are the tools of the trade. Should they be damaged or stolen, you need to be able to get them replaced quickly and to at least the same standard, to ensure continuity of trade and to deliver the level of service to which your clientele have become accustomed.
There are practises that you should incorporate within your day-to-day business that may carry favour with insurers, providing that you can prove they are being adhered to.

For example, if, as part of your business (whether it be you, a direct employee or a third party who rents a room within your premises), you are offering skin care such as cleansing, scrubbing and exfoliating, ensure that the person providing this service has suitable dermatological certification. Providing they do so, they will carry out skin testing before any application of product whatsoever.

Likewise, with hair colouring, not all hair-types are suitable for all colourants. Discreet sample testing should be implemented for any new clients and ongoing, up-to-date records kept as proof in light of any claim.
So, like your tools, stay sharp and do not cut corners, especially where your insurance is concerned.

Euroferret.com is owned by Mediamash (NI) Limited, who are an Introducer Appointed Representative of Seopa Ltd. The quote system is owned and operated by Seopa Ltd, who are authorised and regulated by the FCA, number 313860. You can view our registration at www.fsa.gov.uk/register/firmSearchForm.do?sid=127135. We do not give financial advice on this website. If in doubt get professional advice and always read the policy information before purchasing an insurance contract.