Generally no as brokers are not professional Claim Preparation Specialists or Accountants.
Any of the MSM team can discuss your client’s position and provide an initial view on whether there may be a claim.
There are not many statistics which show how many claims have a Claims Preparer appointed however our view is that it is much lower than it should be.
As a matter of principle, you should always appoint claims prepares on a BI claim regardless of the size of the loss. MSM or any other professional firms can assess the situation and decide to let the claim run without them if it is not worth their involvement.
Some Policy Wordings include default Claim Preparation cover. We see $25,000 as a default for example in a Steadfast Business Package wording across the main pool of insurers.
It is always a matter of confirming with the Policy Wording.
This is Policy Wording specific. Many Policies do not require approval (e.g. Steadfast ISR and Business Package standard wordings).
As a matter of professional courtesy we will always discuss our appointment with the Loss Adjuster.
We provide update to the loss adjuster and broker as may be necessary and whenever there is an event that will impact on the claim process and disruption period. This should be at least monthly but may be much more in the early stages. It is a collaborative approach between claims preparer and broker. Managing expectations and keeping all stakeholders informed is one of the major claim preparation strategies.
Approval should be given in 24 hours. Payment of fees will depend on the timing of claim submission and invoicing by the service provider.
Are there times where you get involved in smaller claims? e.g. water damage causing flooding inside an office or to equipment
The MSM Claim Preparation model is scale able and we are always available to assist any time there is a Business Interruption claim or the client needs strategic help.
If the event is covered under our policy and prevents or hinders access then a claim would be payable.
Yes. Deductibles are normally any one event.
Claims preparation fees are not subject to Indemnity Period and they can be incurred and claimed outsider the Indemnity Period. Usually Business Interruption claims are finalised after the Indemnity Period and once the financial data is available.
Insurance is based on the principle of good faith and is dealt with in Sections 12, 13 and 14 of the Insurance Contracts Act.
It is expected that both parties honour their respective duties and obligations under the Insurance Contracts Act. Interest is payable under the Insurance Contracts Act from the time the money is unreasonably withheld. However, if there is any doubt as to the behaviour of either party and there is a reasonable ground to believe so, then there is no reason why a remedy is not sought either through the Ombudsman or a legal remedy or a complaint to ASIC under the Code of Practice.
No, Claim Preparers can generally have varying levels of involvement and can tailor their approach from small claims to much larger claims.
That is one of the critical roles of the claims preparer, i.e. to ensure progress payment match client needs.
If they have unreasonably withheld payment then the client may be able to claim interest under the Insurance Contracts Act. An effective claims preparer can overcome these issues and will work with you to ensure that your client gets the best possible outcome under your claim.
It would always be client specific however generally we would advise an increase.
The minimum amount should be around $50,000 for a small entity moving upwards to $150,000.
Bearing in mind, claim preparation is relevant for both the Material Damage and Business Interruption claims. For larger businesses we recommend you start at $150,000 and consider 5% of the gross profit cover as an appropriate guide for there.
Understanding the complexity of the business is key. We recommend tailoring as necessary for the business, potential loss, the location and if dual payroll is covered.
The level of complexity and accuracy of the financial records/reports of an insured will have an impact on the timing and cost of preparing and presenting their claim. The quantum should not be affected by how the insured’s financial records are maintained but good quality financial statements make it easier to get timely progress payments.
Also, after say an excess of 2 days, how is the insured indemnified (paid out), Weekly, Monthly etc.
The Period of Loss depends on whether or not the Insured is able to generate the same of level of business that we would have been able to achieve had it not been for the Incident. In most cases, this depends on the growth trend agreed with the Loss Adjuster and the actual revenue compared to the standard revenue.
When claim payments are made depends upon the Policy type and the nature of the claim. If it is a weekly cover (as suggested by the 2 day excess), then it is often paid weekly. Otherwise progress payments are agreed with the Loss Adjuster and facilitated by claim submissions.
MSM comprises a multi-disciplined professional team including qualified accountants with over 25 years experience.
Our team has expertise across a diverse range of industries and organisations.