Warranties are continuous promises running throughout the policy year and must be complied with at all times. Otherwise, the policy is automatically void. Not all insurers insist on all of these, so check carefully when obtaining quotes. The following are among the most common warranties.
More claims fail on this point than for any other reason. In the policy application, you are asked to state current physical inventory amount and date. Don't guess or put in a lower amount to save premium. If you give the wrong information, you are in breach of warranty, i.e. not insured. You have just wasted your money.
Often overlooked is the requirement to keep separate lists of travellers' stocks. Any person who carries goods away from your premises is a traveller. Play it safe - always leave a record behind.
Other people's goods fall into two categories: memo/consignment and customers' goods. Keeping memo and consignment notes is an effective way to comply with the warranty. Customers' goods require some in-house bookkeeping. The best system to operate is a logbook or use a multi part job bag, keeping one copy of the work order separate as a control.
Insurance companies tend to work to formulas and believe leaving more goods than agreed "out-of-safe" significantly increases the risk. Many claims are denied for this reason, and litigation has shown that most courts will support this.
The purpose of this clause is to ensure that showcases containing valuable goods are not left open and unattended. Check this exposure by having single key control of all your showcases, and have staff members carry their keys at all times.
It is estimated that in approximately 20% of hold-ups, video recorders were not working. When something goes wrong with your security equipment, always advise your insurance broker or insurer. If outside regular business hours, it's advisable to "act as if uninsured". For example, if your alarm breaks down, inform the police, leave lights on, and sleep in the store overnight.
To insurers, "attended" means actually being with the vehicle - either inside it or on it. Watching your car through a restaurant window is not attending the vehicle. Some insurers will provide unattended automobile coverage provided the following protection is installed:
1) An automatic setting alarm system covering all doors, hood, and trunk plus disabling of the ignition. Alarm systems can fail if the vehicle's battery runs down due, for example, to the lights being left on. A back-up battery should always be added.
2) A padlock and chain is also required to secure the trunk lid.
Note that signs of forced entry into the vehicle are essential for a claim to be accepted.
When opening for business, keep all exterior doors locked while goods are being removed from safes and placed in showcases. Except for employees, no one is allowed to enter the premises until you are ready to open for business. Similarly, all customers must leave and the doors must be locked before the process of transferring your stock from your showcases into your safes can begin.
89 Skyway Ave., Suite 101
Toronto, ON M9W 6R4