On the face of it there are many ways in which you could buy insurance for your vaping business. You could go direct to an insurer or head to one of the comparison sites, such as Go Compare or Money Supermarket. But can you be confident that you’d get the right insurance by taking one of those routes? Have you considered working with an insurance broker instead?
Insurance brokers are professional companies, regulated by the Financial Conduct Authority (FCA). Insurance brokers aren’t tied to any one particular insurer but will work with a panel of insurers to find you the right cover and best price for your insurance needs.
They work on your behalf and in your best interests, not those of the insurer.
According to the Money Advice Service, when it comes to insurance, brokers are ‘experts in the market and – even with run-of-the-mill insurance – they can often find you better cover at a great price.’
Insurance brokers can:
- Provide advice on the specific risks that you may face as a vaping business
- Find the right insurance to meet these needs and cover these risks, at the best price from insurers in the vaping market
- Support you through the claims process – speaking to loss adjusters and claim handlers
Why should you use an insurance broker?
Anyone can use an insurance broker to arrange their insurance. However, when your business is in a more niche sector such as vaping, the role an insurance broker plays in finding your insurance is particularly valuable.
For businesses like yours it’s worth using an insurance broker who specialises in vaping insurance. Their team will have an understanding of the vaping sector and will be well positioned to advise you about the cover you may require.
Insurance brokers can help vaping businesses like yours to find the right insurance because:
Your insurance needs may be more complex – it may be that you manufacture, or stock your own brand of e-liquids for example.
You need specialist cover – vaping businesses tend to face a specific range of risks which means they are seen by insurers as requiring different cover to other retailers and businesses. Some will try to shoehorn you into their closest fit insurance product – we’ve come across vape shops with insurance cover for tobacconists and electronic goods retail insurance for example – but this is not advisable.
You need a specialist provider – comparison sites typically offer a more generic selection of insurance providers – those that cover mainstream risks. There are only a handful of insurers who are prepared to cover vaping businesses because of the specialist nature of cover needed. Brokers are more likely to know who those providers are. They will be able to access those specialist providers or use their buying power to negotiate the right cover from mainstream providers.
How are insurance brokers different to insurance agents?
An insurance agent will typically only work for one insurance company. In comparison, an insurance broker works on the behalf of the customer and will have access to a wide range of insurers across the market, so choice and cover is not limited.
If you work with an insurance agent you will only have access to insurance products from the particular insurance company that they work for. While an insurance agent will get you the best cover from the insurer they work with, you will be limited with regards to the rest of the insurance market. An agent therefore effectively works on behalf of an insurer.
Whereas an insurance broker works on behalf of the client. BIBA code of conduct states that brokers must ‘Act in the best interest of each client’. This gives you access to a wider range of insurers.
Does using an insurance broker cost you money?
No, working with an insurance broker should not cost you money. They will provide insurance quotations and advice free of charge. Brokers are paid a commission by an insurer when they sell one of their products. In the same way that a comparison site is.
Before working with an insurance broker do check that they are regulated by the Financial Conduct Authority to give you peace of mind that you are working with a genuine company.
The important thing to remember is that insurance can be a very complex purchase, particularly for vape businesses. Getting the wrong insurance, not enough insurance or not protecting against the right risks can be devastating if you do have to make a claim. If you buy your insurance directly from an insurer or via a comparison site, then the risk of getting something wrong sits entirely with you. Going to an insurance broker gives you an expert view and expert advice from people who specialise in insurance.
If you are considering working with an insurance broker, read more about why Anthony Jones are a trusted, independent, local insurance broker here. You can also find out more about our expertise in the area of vaping insurance. Please feel free to contact us if you want to discuss any of your insurance needs.