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Asbestos Liability Insurance - Everything you need to know
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Asbestos Liability Insurance is usually required by most asbestos removal companies across Australia however, whether you are looking to get into this industry or currently working in the field already, do you actually know what your asbestos liability insurance is and how it covers you?
After providing hundreds of asbestos liability insurance policies we are going to go into further detail on what asbestos removal insurance is, who should consider it and why.
We understand that insurance can be confusing especially when it involves high-risk occupations like asbestos removal so after speaking with clients on a daily basis, here are some of the key things that you should know.
What insurance do asbestos removal companies need?
Most asbestos removal companies should consider having the following insurances:
- Public Liability Insurance which has asbestos liability insurance included
- Plant and Equipment Insurance
- Truck Insurance
The 2 types of asbestos insurance and how they affect you
There are 2 ways that an asbestos insurance policy can be written and you may have heard of these terms being used if you have been in the industry long enough and received asbestos liability insurance quotes before. There is a big difference between the two options which can lead to costly changes in the future, depending on which option you go.
Claims Made:
A claims made policy in its simplest form means that this policy will cover you for asbestos related works from a specific date, usually referred to as a retroactive date that is listed on your policy. This means that should a claim be made in 2022 for something that occurred back in 2011 then provided your retroactive date goes back that far then the current policy would provide cover for this claim. The general rule of thumb is, cover is provided if a policy is in place when a "claim is made".
Occurence:
Occurence based policies are different to a claims made policy however, they are what your standard public liability insurance policies are written as. This simply means that as long as you had a policy when the incident occured then you could go back to that insurer and lodge a claim. So using the example above, if the claim occurred in 2011 and you held a policy with XYZ Insurance at that time then you are able to lodge a claim on this expired policy.
Why does this matter?
Why does this matter?
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Which option you choose matters because there is a major difference when you go decide to stop trading and you wish to cancel your asbestos removal insurance policy. For an occurence based policy, you can cancel the policy and be confident that providing you haven't issued any invoices or done any further asbestos related work then you will have a policy that will respond to claims even if something comes up after you cease trading.
Whereas, when you cancel an asbestos removal insurance policy on a claims made basis then this means that you are declaring to the insurer that no further claims will be made on this policy. Remember, a policy needs to be in place when a claim is made. To put this into realistic terms, you cease trading and working with asbestos in 2021 its now 2024 and a letter of demand has been received notifying you that work you did in 2015 has since caused personal injury to someone. If you cancelled your policy when you stopped trading in 2021 then there would be no policy available to respond to a claim.
When you have a claims made policy and stop trading, to continue your coverage you need to place the policy into a form of run-off cover. This declares to the insurer that no further work is being done however, a policy needs to remain in place in case something arises in the future. As the policy stays in effect, the insurer will continue to charge a premium for each year the policy remains in place. Run off cover will usually mean that a tiered policy premium will be calculated however, premium increases and price fluctuations can still continue as normal.
When does an asbestos removal company require Professional Indemnity Insurance?
Professional Indemnity Insurance for Asbestos Companies is required for companies that are providing the following services:
- Asbestos Clearance Certificates
- Gathering Samples
- Testing Samples
- Providing remediation recommendations
These are just a number of activities that usually require Professional Indemnity Insurance however, as the industry and the activities evolve more could arise.
How to get a quote for asbestos removal insurance?
Most asbestos removal insurance policies are only available through a business insurance broker, as most of your direct insurers won't provide cover for asbestos removal companies as an occupation. Some of the information that we require is the following:
- Your general business information such as name, address, email and phone number
- Your estimated turnover
- What asbestos related activities you perform
- Any additional business activities that you do; for example, we can usually combine demolition and asbestos removal insurance under the one policy instead of providing two separate policies for these activities
- Some insurers will require a copy of your asbestos license (if you haven't applied for your asbestos license then they can be obtained from WorkSafe QLD, Service NSW, Asbestos Victoria)
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Daniel Ufer
How much does asbestos removal insurance cost?
As one of the leading asbestos insurance policy providers here in Australia we aim to be as transparent as possible with our clients. Although we cannot give you an exact premium of what a public liability insurance policy with asbestos coverage costs we can give you an estimate for budgeting purposes. The minimum premium for most asbestos insurance syndicates range from $4,000 - $6,000 per year under a claims made policy wording. For an occurence based policy wording this can generally range a little higher to between $5,000 - $8,000 annually.
The information above should be considered as a general insurance overview and your business or personal circumstances have not been considered. For specific, tailored advice relating to asbestos insurance, please feel free to contact us to discuss options suitable for your business.
The information above should be considered as a general insurance overview and your business or personal circumstances have not been considered. For specific, tailored advice relating to asbestos insurance, please feel free to contact us to discuss options suitable for your business.
General Advice Warning: This advice is general and does not take into account your objectives, financial situation or needs. You should consider whether the advice is appropriate for you and your personal circumstances. Before you make any decision about whether to acquire a certain product, you should obtain and read the relevant product disclosure statement.
All information above has been provided by the author.
All information above has been provided by the author.
Daniel Ufer, Priority Insurance Brokers, ABN 95 655 563 616, AFSL 233750
This article originally appeared on Priority Insurance Brokers Blog and has been published here with permission.
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