Insuring Your Business: 5 Tips for Better Business Insurance
August 7, 2017
As a business owner, you already know it’s important to plan for the future. One of the best ways you can prepare for whatever lies ahead is through business insurance.
Business insurance is exactly what it sounds like: insurance for businesses. Businesses buy insurance to protect against unexpected emergencies such as equipment breakdowns, product recalls, data security breaches, premises liability, property damage, and workplace injuries. Whether your company is large or small, business owners use business insurance to keep themselves covered when things don’t go according to plan.
Equally important to having business insurance is choosing the right coverage for your business. Iowa Insurance Institute suggests the following five tips to help you find the right insurance for your business and ensure your company is prepared for the future.
1. Hire and work closely with an agent.
Having an expert as an ally can go a long way in helping you find the most appropriate and most affordable insurance for your company. It is imperative to communicate clearly and regularly with your agent. Make sure your agent understands your company and your industry so they know where to look for the best prices. This will help you find the products that best meet the needs of your business.
2. Join your industry’s trade association.
Consider getting involved with your industry’s trade association. They can provide valuable information when searching for a policy that is right for your business and your budget. Some trade associations provide options such as preferred carriers or carriers that offer certain specialized coverage for your specific industry.
3. Buy a package policy.
For small businesses, a Business Owner’s Policy (BOP) may be a great way to save money. A BOP offers property and general liability insurance in one policy, usually costing less than if purchased separately. For larger or growing businesses, a Commercial Package Policy (CPP) bundles multiple lines of coverage at a cost savings. These types of packages can also help avoid gaps in coverage when multiple companies are involved. Many lines of coverage can be included in a CPP, such as Business Income Insurance, Vehicle/Fleet Insurance, Equipment Breakdown, and many more.
4. Choose a deductible that fits your business and exposure level.
Deductibles are payments you make before your insurance policy covers the rest of the cost for a claim. Higher deductibles generally lead to lower monthly premiums, which is a great way to save your business money. However, you’ll want to be careful not to set the deductible too high that it would cause your company problems if an emergency does arise. This is another area where it’s beneficial to work closely with an agent to find the right balance.
5. Take advantage of loss control services.
Insurers are here to support you and your business and listening to your insurer’s recommendations to reduce risk can help lower premiums for certain types of coverage. Many insurers provide these advisory services to help reduce the probability of you experiencing a loss. For example, recommendations might include installing alarms and sprinklers, implementing emergency mechanisms for safety and disaster preparation, and providing anti-discrimination training to employees – all ways businesses can work to save money. Be sure to ask your agent for more details.