Growth by Acquisition

In todays current Economic Climate many business’ are electing to increase their growth by way of acquisition.

Whilst this strategy remains sound there are many considerations that need to be undertaken prior to purchasing an existing business, particularly if that business is in the same industry and/or profession you’re currently trading in.

The main key to any successful acquisition is undertaking the appropriate ‘Due Diligence’ prior to any contracts being arranged. Initially, “Commercial in Confidence” Agreements are prudent to be agreed and executed as this provides protection to both the buyer and sellers.

It’s been stated on many previous occasions however if the ‘culture’ of both business’ aren’t similar that it can make the combining of the two entities difficult.

Whilst there are many dollar savings that are able to be achieved as a result of business “synergies” the largest is always the savings made from duplication of staffing. Any successful unification of business’ places a great deal of emphasis on the ‘coming together’ of multiple business’.

Some of the other cost savings that are able to be achieved are -: Lease & Rental duplication, Office Leases, Computer & IT Savings, Motor Vehicle duplication, Professional Fees etc.

As with all business acquisitions and purchases ensuring that the appropriate Sale Contract is in place is critical. It’s very important that matters relating to previous and ongoing taxation and other financial matters are succinctly dealt with so that neither of the parties is disadvantaged post settlement. The early involvement of Solicitors and Accountants, together with any other Business advisors such as Insurance Brokers, will assist in the smooth transition of combining entities.

Social Media Scams

Social media – there is no escaping it. Over time, it has become a way of life, from humble beginnings as a platform
for friends and family to keep in touch, social media is now a complex system that allows all to interact on a personal level from consumers and companies to groups and governments.

It is estimated that there will be around 2.77 billion social media users around the globe by 2019. With that many users it’s no surprise that social media is a hotbed for cyber criminals.

Here are five of the most common social media scams that you could possibly fall prey to.

1. Chain Letters
Just like the dreaded chain letter you used to receive in the mail, the chain letter has returned in the form of social sharing.
“Share this post and Bill Gates will donate $5 million to charity” or “Every like and $5 will be donated to charity”. These are typically ‘like farmers’ or a spammer looking for ‘friends’ to hit up later. Many well-meaning people continue to share their posts and pass these fake claims onto others. Break the chain and leave it.

2. Cash Grabs
Social media allow us to stay in touch with friends and family, but occasionally you may receive an email or direct message from a friend who ‘lost their wallet on holidays and needs some cash to get home’ – you drop everything to help as per their instructions, when in fact your friend never sent this request and is a bulk-email sent from their malware-infected computer. The easiest solution is to ring your friend directly, inform them of the request, then ensure your computer isn’t infected as well.

3. Hidden Charges
The quizzes that pop up on your feed asking “What type of friend are you?” or
“Personality tracker” – all your friends are taking the quiz, all you need to do is enter your information including your email and/or phone number. You may have unwittingly subscribed to a service that charges or spams you.

4. Phishing Requests
“Check out this video I found of you online” Click the link and check it out – you follow the link and your asked to login to your social media. Now the cyber criminal has your password and total control of your account. How did this happen? Both the email and landing page were fake. That link you clicked took you to a page that only looked like your intended social site. It’s called phishing, and you’ve just been had. To prevent this, make sure your Internet security includes antiphishing defenses. Many freeware programs don’t include this essential protection.

5. Hidden URLs
Shortened URLs, particularly on Twitter are common place, and while many times clicking on a shortened link will take you to the website you wish to go, it could be a link that installs all sorts of malware on your computer.
URL shorteners can be quite useful. Just be aware of their potential pitfalls and make sure you have real-time protection against spyware and viruses. Bottom line: Sites that attract a significant number of visitors are going to lure in a criminal element, too. If you take security precautions ahead of time, such as using antivirus and anti-spyware protection, you can defend yourself against these dangers and surf with confidence.

Reputations in the Financial Services Industry have been savaged!

The royal commission into Australia’s financial services sector continues to reveal how customers’ lives have been ruined by financial advice at the big banks, but those in the finance space are predicting the investigation will also change the game for smaller operators and independent financial advisers.

Recent hearings into the nation’s banking sector uncovered shocking tales of customers being charges by AMP for financial advice they never actually saw, and customers losing their family home after taking advice from Westpac.

The inquiry has also revealed cases where customers did not fully understand the financial services they were paying for, or weren’t informed about what they were paying for in the first place.
However, as the CEO of the National Insurance Brokers Association (NIBA), Mr Dallas Booth, highlighted in a recent address to members of the Council of Queensland Insurance Brokers, not all sectors of the Financial Services Industry are performing poorly.

The NIBA Board of Directors recently met with the Lead General Insurance Ombudsman, John Price. John Price provided the following data for insurance broking disputes as at the end of April 2018, which showed disputes against insurance brokers were well down compared to the same period in 2017. Only around 13% of disputes reach a formal determination by the Financial Ombudsman Service, and of those, around 75% are being decided in favour of the broker.

During the same period, the number of general insurance disputes continued to increase substantially. Disputes against general insurers increased from 11,500 to over 13,000 during the same period. General Insurance disputes were around 5,000 a few years ago. NIBA expects the Royal Commission will try to examine the causes of such large numbers of disputes involving general insurance companies in the September hearings.

Unfair contract laws to be extended to insurance

Many of you would be unaware that existing legislation dealing with unfair contracts, does not apply to insurance.

Given the generally held distrust of insurers who “use the small print” to escape from paying genuine claims, some people would say that is a position which shouldn’t continue…and the Government agrees.

Following an announcement that a proposals paper has been prepared to extend unfair contract provisions for consumers and SMEs to insurance policies, the relevant Minister, Kelly O’Dwyer, believes that better protection is long overdue.
She said “Consumers and small businesses who enter into standard form insurance contracts should have confidence that the contract accurately reflects the cover agreed with the insurer”. “They should also have appropriate remedies when they suffer detriment as a result of terms in the contract which are unfair.” The lobby group for the insurance companies… the Insurance Council of Australia…have stated that they have “serious concerns” about the proposal, but many people would argue that the same protections from unfair contracts which exist for other financial products and services, should apply to insurance.

“While the ICA will work carefully through the proposed model with members… on an initial reading, the Governments proposal has profound implications for insurance contracts, the scope of cover offered and the pricing of insurance,” the group CEO said. “If implemented, it would cause insurers to fundamentally review their contracts and reassess their pricing”.

While it’s true that the introduction of the law to other providers of financial services, caused a substantial review of their fundamental contractual terms, the recent Financial Services Royal commission has shone the light on some appalling actions by the Banks, and while previous reviews of the insurance industry has not found any compelling evidence that introduction of these laws into the industry would significantly benefit consumers and SMEs, in the increasing age of transparency, it is hard to argue against its extension to insurance.

Fire

Make sure you’re insured for fire this Winter

Winter has arrived and with it, an increased risk of house fire.

Queensland Fire and Emergency Services have issued a warning and reminder to residents to re-check their heating devices and keep flammable items well clear of fires and/or electric heaters.

QFES Manager Community Safety Operations Gavin Holden said between 1 June 2017 and 31 August 2017, firefighters in the Northern Queensland region attended almost one house fire every three days.

TOP TIPS:

  • Check appliances (like electric blankets and heaters) for fraying or exposed cords or rust, or overheating.
  • Make sure flammable items are kept away from heaters and fireplaces
  • Turn off battery chargers when not in use
  • Install photoelectric smoke alarms and regularly check that they are working.
  • Check your insurance cover is paid and sums insured are accurate.

Queensland Fire and Emergency Services department said the key triggers for house fires in winter were heaters, electric blankets and fireplaces and flues.

Common causes of fire include frayed cords or exposed wires on electrical appliances, clothing and other items being left on or too close to heaters, embers rolling or sitting from fireplaces, flues becoming blocked and causing heat to build up, and battery chargers overheating.

“It’s understandable that residents are looking for ways to stay warm during the cooler months, but it’s imperative it’s done safely,” Mr Holden said.

“There are a lot of simple steps residents can take to limit the chance of a house fire, including turning off electrical appliances when they’re not in use.”

QFES also recommends thinking about fire preparation including:

  • In a fire, get out immediately. You only have a few minutes before the fire and smoke becomes life threatening.
  • Prepare and draw your escape plan. Have two ways out of every room and pick a meeting place outside of the home.
  • Turn out the lights and practise your escape plan.

QFES also warned that outdoor heating equipment is designed specifically for use outside, in open, aired spaces and should never be brought inside to warm your home.

To get a home and contents insurance quote or to review your cover, call Piranha Insurance 4927 8400

 

What is a data breach?

Did you know you can face fines of $360,000, to $1.8 million for not reporting privacy breaches in your business?

 

On 22 February 2017 the Australian Senate passed the Privacy Amendment (Notifiable Data Breaches) Act 2017, requiring that data breaches, specifically the unauthorised access or disclosure of personal information about one or more individuals, are reported to the Privacy Commissioner, other relevant regulators (such as APRA) and affected individuals within 30days.

 

We consulted our cyber insurance experts “Emergence Insurance Australia” for an update on who is impacted by the new law and what it means to you.

 

What is a data breach?

Emergence Insurance Australia says data breaches occur where there is:

  • unauthorised access to, or unauthorised disclosure of, personal information about one or more individuals (affected individuals), or
  • where personal information of affected individuals is lost in circumstances that may give rise to unauthorised access or unauthorised disclosure.

Data breaches may be caused by malicious intentional actions, such as a serious cyber security incident, accidental loss, loss from negligence or loss from improper disclosure.

 

“The mandatory reporting provisions apply where a reasonable person would conclude that there is a likely risk of serious harm to any affected individual as a result of the data breach,” Emergence Insurance says.

 

Is my business covered under the new reporting legislation?

Under the act, State government organisations, local councils and organisations with an annual turnover of less than $3 million are exempt from the Privacy Act. However, mandatory reporting applies to:

  • Australian government agencies
  • businesses and not-for-profit organisations with an annual turnover of more than $3 million
  • private sector health services providers (including alternative medicine practices, gyms and weight loss clinics, which fall under this category)
  • child care centres, private schools and private tertiary education institutions
  • businesses that sell or purchase personal information along with credit reporting bodies
  • some smaller organisations, such as those that handle health data, and
  • individuals who handle personal information for a living, including those who handle credit reporting information, tax file numbers and health records.

In summary

If your business requires customers to provide personal data including tax file numbers, personal health or government indentification (CRN numbers), it is highly likely that you will be required under the act to report any misuses or breaches of your computer security.

Reporting means notifying your customers and the Privacy Commissioner and other relevant authorities.

For more information and how to report a breach go to

https://www.oaic.gov.au/privacy-law/privacy-act/notifiable-data-breaches-scheme#how-to-notify

 

To make sure you are covered for cyber attacks on your business contact the Piranha team today.

Travel smart and travel safe

Passport – check. Clothes – check. Medications – check. Smartphone – check. You’ve got all of the above, but what about travel insurance?

Travelling overseas can be a fantastic adventure – but you shouldn’t do it without first having a travel insurance policy in place.

Not all travel policies are the same with many policy limitations that sometimes aren’t as obvious until it’s too late. It’s vitally important to ensure that you’re purchasing a policy that is adequate for where you are going together with coverage for activities that will be undertaken.

Many activities are not included in the “standard” policies for example heli-skiing or caving or certain underwater activities may be excluded or have policy

limitations imposed. Be careful to ensure that any activities you intend to undertake are covered prior to your departure.

Further, you should also make a point of looking up the Government’s smart traveller website to check the “safety status” of the country you intend visiting. This official site classifies countries according to travel safety and, of course, in many parts of the world this is volatile and subject to constant change.
The highest warning the Government issues is its “Do Not Travel”, which advises against travel to certain destinations. Some current “Do Not Travel” warnings include Syria,
Afghanistan, Iraq, South Sudan and Yemen. Be aware that if you travel to countries against advice, your travel insurance will most likely be voided. A number of countries are on a “Reconsider your need to Travel” list. While your travel insurance will usually provide coverage in this case violence, political unrest and terrorist activities can escalate quickly, and may force the Australian Government to upgrade its warning to “Do not Travel”.

To ensure that you have the appropriate travel insurance its prudent to discuss your requirements with us, so we can tailor a policy accordingly and arrange well prior to your departure date.

Protecting against cyber predators

On May 13, 2017 many internet users in the UK, Europe and Russia woke to a major Ransom Cyberattack. The USA was lucky, they were able to stem the outbreak, but the total number of people, companies and Government bodies effected may never be known.

Hackers don’t care who it affects and we are all vulnerable and potential targets as the internet and email are two essential tools that are used to run and grow your business. Equally they can be one of the easiest paths to severely disrupt or ruin your business.
These international data crime gangs use sophisticated methods and systems such as
malware, ransomware and data phishing, which are all aimed at infiltrating your systems and hijacking your data. With the plan to steal usernames, passwords, access your accounts and pins, make purchases, or simply sell information about you to other parties for use in illegal purposes. Their goal is money with no thought of their victim’s ruined credit rating, lost money and ruined lives.

If your computer is successfully hacked and data locked up, the criminal’s promise to return your data is usually subject to payment of a ransom demand, usually Bitcoins; and in some
circumstance even if payment is made, your data may not be released.
Whilst Australian law enforcement authorities state that the smaller ransom demands are known by the criminals to be more successful, as those affected are prepared to quickly pay small amounts and not report the problem, demands in the thousands of dollars have been seen recently in Australia in the small business sector.
Microsoft had already issued patches but many users do not always immediately install updates or are still operating on old program versions for which no updates are available.
There are actions you can take to reduce your risk to these gangs, protect your systems and your business. Industry specialists recommend these actions to protect against cyber predators:

  • Use a firewall.
  • Update your system regularly.
  • Use up-to-date program versions.
  • Increase your browser security settings.
  • Avoid questionable websites.
  • Only download software from sites you trust.
  • Use antivirus protection.
  • Install antispyware protection.
  • Use a pop-up blocker.

Most importantly, instigate a regular data back-up regimen with at least one copy off site. In addition, Cloud storage via Dropbox or similar services is a growing and reliable option.
When all else fails, further protection is available in the form of new and developing insurance products that can help you pick up the pieces following a cyber-attack event.

As software developers know, hackers develop viruses and intrusive encryption systems even before a new piece of software is released to the market. Do what you can to keep your
commercial information safe and talk to us, your broker about what covers are available to stay one step ahead.

THE NEED FOR SPEED

Peter Peirano’s passion for competitive drag racing dates back four decades and involves his whole family

PETER PEIRANO, principal of Rockhampton-based Piranha Insurance Brokers, has a love of drag racing that began at the age of 17 at Surfers Paradise. Today, Peirano and his family own the vehicle

Time Traveler and are part of the Aerofl ow Outlaw Nitro Funny Car Show, which takes them right across Australia.

“I just love the fact that it is, for us and many other teams, a family event,” Peirano says. “The comradeship with our other drag racing families is just amazing.”
Asked to name standout highlights from time spent on the track, Peirano mentions his son, Nathan, winning two Australian National Drag Racing Association gold Christmas tree trophies, as well as third place in the Aerofl ow Outlaw Nitro Funny Car Spectacular Extravaganza, which saw him beat a USA nitro funny car world champion.

And there’s still plenty more on the road ahead. “We have twice travelled Rockhampton to Perth and back to race,” Peirano says. “I just love it.”

Insurance health check

Forget New Year’s Resolutions, at the beginning of 2017, it’s time to have a health check of your business and have a look at five mistakes you might be making with regards to your insurance.

1. Not regularly reviewing your insurance policies
Don’t leave it to once a year (usually at renewal time) to review your insurance policy. What was relevant to you at the beginning of the year, could be significantly different to your requirements at the end of the year and all the changes that come in between. It’s important to keep us up-to-date with any changes happening in your business (or at home) to allow us to ensure you have correct coverage and to ensure you are covered in the event of a claim. Use the start of the year to have a health check on your insurance with us and make a note to have a review every quarter, making sure you keep us in the loop with any changes.

2. Not getting advice from your broker when deciding to enter a different market
Many businesses are changing and adapting to the market and with the internet breaking down international borders, it’s easy to look to a new market to expand and grow your market. This could be importing products to sell in Australia, selling online domestically or overseas or exporting to international markets. You might think this is no different to regular business, but it can be. Talk to us if you make any significant changes with your business, particularly entering a new or different market. We are here to help you navigate this change and ensure you are adequately covered.

3. Under-insurance and Inadequate Business Interruption Insurance
A few articles in Brokerwise in 2016 tackled this subject and if you didn’t heed the advice then, take a look now. Many businesses around the country are under-insured meaning if there is a computer or electronic breakdown, machinery breakdown, burglary or even fire – your business might not be covered. Sit down with us to discuss your insurance needs and make sure you are adequately covered for the year ahead.

4. Reducing premiums when times are tough
When your business is going through a rough patch and times are tough, it’s tempting to reduce your insurance expenses to save some dollars. But this could have long-term ramifications. Talk to us about better solutions and ways in which we can help you possibly save some money without affecting your level of cover.

5. Being your own insurance broker
Google is a fantastic tool for finding out a wealth of information and can be a great tool in researching what type of insurance protection is out there for background information. But Google cannot replace the personal service of your broker.

We are here to deliver a professional service and a level of detail that an internet browser cannot. While the deal might seem great, you may end up under insured or worse – not insured. We are here to provide options and discuss in detail your level of cover.