Practicing as a professional in today’s financial world can be rewarding and at the same time risky. It is advisable to look for a company that has developed specialised insurance products to protect the business activities of the accommodation industry. Policies can vary depending on the sort of business you are involved with. Therefore specialist policies have been developed for each sector of the industry from bed and breakfast to backpackers to the largest multi-national resorts.

Exposure to expensive, time consuming litigation from disgruntled clients is a real threat in today’s society and it is crucial that every professional ensures his or her activities are covered by a professional indemnity and public liability policy which has been specifically designed for their business activities.

Increasing consumer awareness and consumer related legislation is placing an ever increasing burden on professionals. Together with effective risk management strategies you need a comprehensive professional indemnity and public liability program.

You will also need to be able to deal with a company that has a professional claims service that is easy and reliable to deal with when you need it most.

Ensure you have an insurance package to cover the following exposures that you are faced with on a daily basis:

• Cover for public liability

• Professional indemnity

• Office contents

• Loss of business income

• Landlord’s insurance

What to look for when purchasing insurance for your management rights:

• An insurance professional that can offer all of the covers required

• An insurance professional that specialises in management rights insurance

• An insurance package that covers the following additional benefits at no additional cost

Run off cover

As professional indemnity insurance is a ‘claims-made’ wording, there must be cover in place at the time a claim is notified to you or made against you. In the event that you have sold your management rights and a claim is made against you after this, you must have cover in place to protect you at this time. Run off cover provides extended cover of your professional indemnity policy for a period after you have sold. As we recognise this as an immediate exposure to our clients, we have negotiated with our underwriters to offer a free run off cover to all of our clients ensuring that they have total protection even after they have sold their management rights.

Cover for relief managers

Management rights is commonly a 24hour-a-day, 7 day-a-week profession and when you do finally get to have a holiday, you must ensure that your insurance provider is willing to offer cover for relief managers and at no extra costs to you. Some resident unit manager insurances offer this additional benefit of cover at no extra cost to you so when you do get the chance for that break, you can go away knowing that your interests are protected.

Cover for real estate sales within your complex

Subject to licensing requirements you may at some point decide to sell units in your complex. It is imperative that your insurance coverage will cover you for this and not all insurers provide this cover for resident unit managers as standard under the policy coverage. Some insurers recognise this as part of your everyday business activity and offer this cover as a standard policy inclusion.

Nil excess

It is always best to try and obtain a nil excess for your liability insurance to ensure no additional costs are incurred by you to cover the initial legal costs associated with a professional indemnity claim. Insurers offer a wide range of excess options under insurance contracts these days and it is important to choose an excess that suits your requirements.

Ease of transacting business

There are so many things to consider when purchasing management rights and so many items to finalise before settlement can occur.

As the insurance is one of the most important issues to consider it is imperative that this is handled for you professionally and efficiently and offers you the flexibility that you require, not what the insurer requires.

Some companies offer a wide range of options for your insurance package including choice of excess and policy limits, choice on the expiry date of your policy, monthly payment options and many more options to suit your individual requirements.

Your specialist broker will not only assess your risk but can assist you to minimise the cost of placing the right policy for your situation.

There is no one size fits all solution so it is essential that you get the right advice from the very beginning.

Choosing the right broker with the industry credentials required is the cornerstone of any risk management program.

By Shane Flower - Account manager ACE-IRM Insurance Broking Group P/L