Member Article

Calls for Government to prioritise infrastructure spending

Henderson Insurance Brokers (HIBL), the region’s leading insurance brokers, is urging the Government to increase infrastructure spending after the North East was put on major flood alert for the second time in two months.

HIBL points out that the latest deluge will undoubtedly increase annual preniums across the board.

The company is calling on the Government to make spending on improving flood defences and infrastructure on roads and rails priorities.

Jonathan Willett, HIBL Teesside Director, said: “Cash-strapped businesses are already feeling the pinch from the recession, inflation, the fall-out from the banking crisis and a lack of access to funding.

“The financial knock-on effects of this year’s repeated floods will put further pressure on businesses in the region.”

HIBL suggests that the floods will add about five per cent to annual premiums across the board.

The latest flooding alerts to hit the North East come just a few weeks after torrential rain and high winds lashed Britain in the worst September storm in more than 30 years.

Mr Willett said: “Road and rail chaos and closures have impacted businesses across the region with workers being unable to get to work, and businesses being unable to meet clients and do business.

“Businesses are paying the price for this year’s extreme weather with businesses in the region facing the prospect of clearing-up yet again in the wake of the latest storm damage.”

As well as urging the Government to shore up the nation’s major transport networks, including our roads and railways, HIBL is calling on businesses to ensure that they are protected when the worst case scenario happens.

While no up to date statistics have so far been released about the impact of this week’s flooding on businesses, the financial toll is set to stretch into many millions of pounds.

The Association of British Insurers (ABI) has stated that the storm and flood damage suffered in July was the worst since the summer of 2007, when flash floods landed insurers with a £2.5bn bill.

Mr Willett said: “Incidents like this will add five per cent to annual premiums across the board. Some may think it is worth taking a risk by not covering or preparing for unforeseen circumstances with an insurance policy tailored to their business needs.

“But as businesses have been finding to their cost this year – the unexpected can happen – and in fact has happed several times this year.

“North East businesses owners, including those whose premises have been wrecked by storms and flooding, are proof that making provision for an unexpected crisis is vital to the security of a business and the employment of its staff.”

Mr Willett added: “When money is tight and cash flow is under pressure, businesses understandably scrutinise their outgoings and see where cut backs can be made.

“In a recession, some may mistakenly believe it is worth taking the risk of not renewing their annual insurance policy or buying an off the shelf bargain basement policy.

“It is vital that businesses seek expert advice to make sure that an insurance policy package is drawn up that is tailor-made for their needs.”

He points out that many businesses run the risk of under-estimating the cost and length of time it could take to get their operations back up and running following a crisis.

The cost of replacing machinery, how long it would take to be delivered, the cost of contracting out the work in the interim, renting temporary premises, the cost of repairs or the complete re-build of premises all need to be taken into account and will differ from business to business.

“But the onus should not just be on businesses. The Government must act now to ensure that the next time bad weather strikes, we are prepared.”

This was posted in Bdaily's Members' News section by Recognition PR Business Team .