Break-ins highlight insurance squeeze

Break-ins highlight insurance squeeze

A spate of break-ins at NSW computer shops has highlighted the insurance squeeze facing resellers. The past couple of months have seen thieves repeatedly target computer stores in Nelson Bay, Newcastle, Kempsey and Swansea, leaving shop owners facing costly security upgrades or increased insurance premiums.

Last Thursday thieves hit Kiama’s Data Depot, carrying off $80,000 worth of laptops, RAM and hard disk drives. “We’re still working out the dollar value we lost,” co-director, Rob Denny, said.

The break-in appeared to have been highly organised as the thieves had cut underground telephone lines to the building, Denny said. Stocked up in anticipation of delivering more than a dozen PC systems this week, Denny admitted the company was under-insured. While the insurance assessors were still working out the figures, he expected quite a shortfall in the insurance payout for the break-in.

Leading Edge Computers in Kempsey was left uninsured after three break-ins in four weeks, in which thieves got away with seven notebooks. Shop owner, Vince Schubert, said insurance company CGU had yanked his cover, instead offering him cover worth just $5000 a year.

“I carry $100,000 worth of stock,” Schubert said. “It would cost me $10,000 a year to get covered.”

The loss of insurance occurred despite Schubert’s investment of around $5000 to upgrade security after the break-ins. The Kempsey store was fitted with barred windows, cameras, reinforced doors and bollards in front of the shop.

Schubert said that in his eight years of insuring through CGU, he had paid $16,000 for insurance and had made claims totalling $9600.

“I would have been better off not being insured,” he said.

Phil Atkins of Computer Highway in Swansea said his premium shot up by “five to six hundred dollars” after a year with two break-ins.

“I expect if we had another break-in, we’d lose our cover too,” he said.

Other shop owners have found that even when their insurance premiums didn’t go up as a result of break-ins or theft, they are still hit in the hip pocket for security upgrades.

Steve Ward’s Leading Edge store at Nelson Bay was broken into three times during June and July, forcing an security upgrade of about $8000.

While police and insurance companies were quick to advise shop owners that they should invest in further security measures, several resellers expressed frustration that they weren’t getting sufficient support from insurers or the authorities.

For more on this story, see this week's issue of ARN.

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