A question of insurance...

aaduki

Equipment Insurance

Some photographers feel that the equipment is their 'life blood' and they couldn't do without it so for them then insurance is the most sensible solution. It means they have some 'hiring in costs' should the worst happen and they need equipment to continue with work commitments whilst any claim is being considered.

There are important things to think about when covering equipment, for example making sure you insure ALL of it. All insurers operate a system called 'averaging'. This means that if you have a total loss claim and you have not insured all your equipment, then you will only get a proportion of the value back. For example, if you have £10,000 worth of equipment and only insure half of it - say £5,000 then under the averaging clause you should not expect to receive more than half of your claim back - £2,500. This is something that is not unique in just the photographic market so look out for it. If you have equipment that you don't want to insure as you don't use it and you feel it has no value then try to get rid of it - maybe on eBay. If you are keeping it as a back-up then you should be insuring it just in case.

Another way to ensure you don't fall foul of the 'averaging' clause is to list every item you insure. This means if you have a total loss, then the items on the list will be paid for at the values you have specified. The downside to this is if you have bought a new piece of equipment and not yet notified insurers of it, it will probably not be covered. When you insure your equipment, make sure you list any item over £1,000 with the insurance company. It is wise to let them know the make, model, serial number and replacement cost from the beginning then there should be no quibbling over value. In some cases, if you are going to be abroad for a while, and not replacing equipment, it is probably worth giving them a complete list. That way, if anything happens whilst you're abroad, they have all the details to hand.

All insurers who provide cover for professional photographers should offer new-for-old cover. After all, the equipment is important to you and, should the worst happen, then you will want replacement equipment. This is no good if you are insured on a second-hand basis! Always make sure you insure your equipment to replace, as new, should the worst happen - and make sure the insurers are quoting on a new-for-old basis - if not, walk away! After all, it is lovely to have a Canon 5D that you paid £500 for but it would cost you around triple that to replace and insurers aren't going to hunt around for a second-hand one at the value you paid so you could end up losing out!

A large number of photographers tend to try to add their equipment onto a household policy. It is really important that you realise that, should you do this and you have a claim, this will affect your contents' cover renewal and you need to ensure that the insurer knows exactly what is being covered, values of equipment and the fact you are using it professionally. Don't just take a customer service adviser's 'yes' over the phone - if it isn't a specific photographic insurer, get it in writing! It is also important to get answers to the right questions - are they covering you in unattended vehicles? What about late into the evening?

Employers' Liability

Employers' liability insurance (EL) is the most misunderstood cover that is available for the photographer today, so confusing are the rules and regulations that surround it even the Government is not sure! However, don't let that put you off, as the Health and Safety Executive (HSE) would be quick enough to prosecute you if they thought you should have it and you didn't, and there was an accident with someone who was assisting you.

If you don't have EL cover, and you should have, then you could be taken to court and prosecuted - the maximum penalty being 14 years in jail and an unlimited fine although this would usually be as a result of an accident to someone who was assisting you. However, you could face a large fine and be disqualified from running a company just for having incorrect insurance. For that extra premium it really isn't worth it.

Firstly, if you are a husband and wife team, or your sons/daughters assist then you generally do not need EL cover. If you're in doubt, then usually a good way round it is to insure them jointly with you - that way all the cover applies to them as well as you. The exception to this is if you are a limited company with two or more working directors then you MUST by law have this cover even if you are a husband and wife team under the Employers' Liability (Compulsory Insurance) Act 1969. There is an exception to this legal requirement which is a limited company with only ONE working person who is a director and owns 50% or more of the issued share capital, ie there are no other persons whatsoever doing any work in the company.

It is also usual for employers' liability to be required if you have work experience students or volunteers assisting you even if there is no payment.

Don't be fooled - you may only have a 'friend' assisting you who is not getting any payment but if something happens to them, even if they don't try and sue you, the HSE may take up the matter or indeed the police may decide to prosecute for negligence. Remember, EL is dealt with under criminal law - the same as murder, assault and arson!

The easy way to define the differences between EL and public liability (PL) would be to use the example of a wedding. If you gather the bride, groom and all the family together and ask them to step back and one of them falls off a ledge and injures themselves, that would be a claim under public liability. If the same thing happened with a student that you were training or an assistant, the cover would be under EL.

Check the website to help you decide if you need this cover: www.swpp.co.uk/insurance.htm

Legal Expenses Cover

If you are a member, the Society pays a contribution towards a free legal helpline for all UK- and Ireland-based members to help you out with immediate questions that need answering. This cover, however, will only provide answers to questions over the phone to assist you - if you still need to take 'action' or defend yourself then you will need to instruct legal counsel and this can be time consuming and costly with the average legal fees from a solicitor now starting at around £100 per hour or more.

Some photographers find it inconceivable that they need this cover but with the price being less than £24 per year for over £100,000 worth of cover offered as a bolt on - is it something that is worth taking the risk on?

What would you do if you found someone was using your images on their web pages and refused to remove them? If you had an unannounced tax or VAT inspection from Revenue and Customs? You had been prosecuted by the police and needed to defend yourself against criminal charges? A health & safety complaint?

What if someone made an official complaint against you and you were summoned to appear before your governing body to explain? This cover would include professional representation to argue your case.

The standard cover of £100,000 provides a cost-effective solution to assist with potential legal disputes that affect your business. It helps to avoid the burden of solicitor's costs and gives you 24-hour access to experienced, qualified legal advisers who can give you on-the-spot advice and assistance. This cover can be added on to an existing policy quite cheaply and with this type of insurance starting at £125.00 plus tax to buy on its own, it could be well worth investing in!

There is always an element of legal costs in professional indemnity if someone is using you for the failure to produce work, but on the other hand what if you have to sue someone for failing to produce work or even worse, failing to pay? This legal cover gives you the certainty of professional advice and assistance, leaving you the time to get on with running your own business. Time is money and, as a photographer - particularly if you are a 'one man band' - then you don't want to spend time filling in court papers, answering emails and generally chasing people or trying to defend yourself when you could be out earning income. This cover helps avoid that.

The Conclusion

Insurance is, in reality, a necessary evil if you are running your own business. For the amateur, it is a way of protecting their no claims discount on their household policy, and for professionals it is a legitimate business expense. The covers outlined above are just a few of the ones available - you should always check that your needs are being adequately met.

Aaduki Multimedia is proud to support the Society and its members and we look forward to serving you through the course of the next 12 months. Have a great Convention and remember to stay safe.