Review and renew your business insurance

Renewing a business policy is a new contract with the insurer, so the legal duties of buying insurance apply again, not just the first time you took cover. Start early enough to compare the market and to avoid a gap in cover. No law fixes the dates below, but this order leaves time to shop around.

Review what you hold

Check each policy against how the business operates now. Premiums and limits usually depend on figures such as these, so out-of-date ones can leave you underinsured:

• turnover, and the number of employees and the payroll, which affect public liability, professional indemnity and employers' liability
• the activities you carry out, the premises you use, including home working, and the equipment and stock you hold
• cover limits your customers or contracts now require
• the excess, and whether you could afford a higher one in return for a lower premium

Make a fair presentation of the risk

A circumstance is material if it would influence a prudent insurer in deciding whether to take the risk and on what terms. At renewal, that usually means changes since the last time, such as new activities, new or changed premises, more staff or subcontractors, claims and incidents, enforcement action or investigations, convictions of directors, partners or the business, and significant changes in turnover. If you are unsure whether something matters, tell the insurer.

If you get this wrong, the insurer's remedies depend on what happened:

• If the breach was deliberate or reckless, the insurer can avoid the contract, refuse all claims and keep the premiums.
• If it was neither, and the insurer would not have insured you on any terms, it can avoid the contract and refuse all claims, but must return the premiums.
• If it would have insured you on different terms, the contract is treated as if it had been written on those terms.
• If it would have charged a higher premium, it can reduce each claim proportionately.

Keep a copy of the renewal questionnaire or proposal form and a note of what you told the insurer and when, in case of a later dispute.

Compare quotes like for like

Put the cover limits, excesses, exclusions and conditions side by side, and ask about claims service. The cheapest premium can come with a higher excess or more exclusions. Check that the insurer, and any broker, is authorised by the Financial Conduct Authority on the Financial Services Register. A broker registered with the British Insurance Brokers' Association can approach several insurers for you.

Avoid a gap in cover

Start the new policy the day the old one ends. A day without employers' liability cover is an offence, so there must be no day between policies.

Your insurer must issue a certificate within 30 days of the cover starting or being renewed. Keep every expired policy and certificate: you may need them if someone claims for an injury or illness years later.

Once the renewal is confirmed

File the new policy documents where you can find them quickly if you need to claim, replace the displayed certificate, and tell anyone who handles insurance queries or claims what changed. If the business changes significantly during the year, tell your insurer or broker then rather than waiting for the next renewal, because a variation to the contract carries the same duty.