According to Louan van Rooyen, Head of Actuarial at Business OUTsurance, the answer to this is not as simple as you may think.

“People who understand the concept of insurance, will not only get the most out of their insurance premium, but will also know how to structure their cash flow and protect their risk profile,” says Louan van Rooyen, Head of Actuarial at Business OUTsurance.

Van Rooyen explains that the main idea behind insurance is to protect the livelihood of your business by eliminating cash flow volatility and to better manage possible accumulation of claimable events.

Replace a single unplanned expense with a small fixed monthly premium

Insurance enables you to replace a single, unplanned expense (for example, the purchase of a new tractor after it has been stolen) with a series of smaller planned expenses – your monthly insurance premiums.

He explains that insurance can be contrasted with a monthly savings plan. Insurance has one distinct advantage over a savings plan in that if something unforeseen should happen in month one, there will be sufficient funds available to cover the cost of the damages – which is not necessarily the case with a savings account.

“It’s also important to budget for an excess so that, in case something unforeseen happens, you have sufficient funds to cover the cost. Some people choose a lower excess because they want to be able to claim for a small loss. Unfortunately, many small claims can negatively impact their risk profile – not only with their current insurer, but also other insurers who will review their claims history when they calculate the monthly premium payable.”

Access to the necessary funds to keep your business in business

Your business may be able to absorb the loss of that tractor, which renders insurance unnecessary, right? But what if a fire breaks out at your farm and all your buildings and equipment are destroyed in one incident? It’s highly unlikely, but not impossible. The chances are slim that a business will have access to the necessary reserves to recover after an incident like this. The good news is that your insurer will have the necessary funds available to assist.

How can OUTsurance help your business?

OUTsurance offers fully customised insurance solutions, with cover options for everything from your farm vehicles to your livestock. Best of all, you can enjoy personalised service – a dedicated OUTsurance Broker can visit you at your farm to assist you with advice, specific to your agricultural insurance needs. This OUTsurance Broker will then also act as your single point of contact going forward.

When OUTsurance says that you ‘always get something out’, they mean it. For them, it’s not just about awesome service when you need to claim, they are committed to ensure that you get world-class service, each and every time you deal with them. Even if you don’t need to claim, you could still get something out in the form of a cash OUTbonus.

Van Rooyen says that they are planning on introducing a new and improved Business OUTbonus shortly, but until then businesses can look forward to 10% of their paid premiums back after three claim-free years.

Protect your farm and almost everything on it with OUTsurance. Start a business insurance quote now and you can request a face-to-face meeting with a dedicated OUTsurance Broker.

“I witness on a daily basis how insurance brings financial relief to businesses. People tend to think that ‘it’ will never happen to them. The reality is that ‘it’ could happen at any time and to anyone.”

OUTsurance is a licensed insurer and FSP. The OUTbonus is a standard product feature, only paid after three claim-free years and premium dependent. Ts, Cs and standard rates apply.