why do I have to provide turnover figures for business insurance

Turnover is the basis for premium calculation

The insurer uses annual turnover to calculate the risk it is insuring, and thus to determine the premium. With a liability insurance or professional indemnity insurance, the premium often depends directly on turnover: the more a business invoices, the greater the damage that can typically result from its work. With credit insurance, turnover plays a different role: it shows how much of the business result depends on the debtors being insured. In both cases, turnover is not a control question about the health of the business, but a calculation variable.

That distinction is the reason an insurer asks something different from a bank or a customer with a sustainability questionnaire. A bank looks at turnover and cash flow to assess repayment capacity — that touches on the question described at insurer asks about our financial health what should I enter. Why these two questionnaires with similar figures nonetheless require a different completion is explained at why does the bank ask completely different questions than the insurer when it is about the same thing. For the answer itself: the turnover from the last completed annual accounts is usually the supporting document with which the insurer wants to substantiate the figure, not an estimate for the current year.

Where the supporting document comes from

A supporting document for the stated turnover is usually the filed annual accounts, and the question of whether it exists and is current is separate from the turnover question itself — that is detailed at are the annual accounts of the enterprise filed?. The Trade Register Act 2007 regulates which data of a business are recorded and published, including the annual figures that businesses must file; that register is the source from which an insurer can verify the stated turnover without having to request separate evidence.