Business Insurance Tips

Being prepared! A motto that has served the Boy Scouts well and it will serve you well too. Having the necessary information prepared ahead of time will make your application not only go smoother, but it will also help to assure that you get the RIGHT coverage at the BEST price.

Do you really want your insurance agent guessing at the answers? Here are a few tips to help you prepare the necessary information for your application.

Loss Runs:
Order loss runs from your current insurance carrier. This is a listing of claims that you had for each policy. An insurance company is going to want to see the details of the types of claims your business had. It will also list the frequency of claims and the amounts paid out. If you have had a favorable loss history an insurance company is more likely to give you a better price.

Policy Declarations pages:
Get a copy of your current policies. The insurance company quoting your insurance is going to need to see what coverage you currently carry. Information like vehicle vin numbers and workers compensation codes are some of the items that are going to be needed to provide an exact coverage quote. Some business owners feel it’s necessary to block out the premium on their policies. Some business owners show the premiums they are paying but let the agent know that they have no intention switching unless they beat the price by a certain dollar figure.

Business Description:
It can be very helpful to the agent by giving them any information that you have that describes your business. The more complete the understanding of your business the agent has the more accurately he can tailor coverage to meet your needs. Brochures, websites, menus, & product literature are a few ways that can help you in describing what your business does.

Property

Building
Have your insurance agent calculate the replacement cost of your building. Your agent should have very precise up to date software that can calculate how much money you will need to replace your building at todays cost of labor and materials. Don’t get confused with what your building is worth “market value”. In most cases insureds are going to want to start their business up again and they are going to need to rebuild the building. Replacement cost ensures you that you will have enough money to rebuild.

Business Personal Property
Get an up to date value of your inventory and your business personal property. Make sure you value your contents at replacement cost. Also, additions and alterations to the building might be included in your business personal property coverage if you do not own the building.

Loss of Income coverage
Make sure your agent assists you in determining what is covered under loss of income coverage. This coverage typically covers your actual loss of income less expenses. It can also cover you for payroll to your employees and extra expenses, such as renting a temporary place, moving expenses, & storage.

Liability

Make sure you give a complete description of all the business’s operations. It is critical that they have a full understanding of what your business does so that they can include all exposures that you have. A typical example would be – A Landscape contractor in the winter months does some snow plowing. The snow plowing may or may not be covered under the landscape policy.

1. Shop around.
   Prices vary from company to company, so it pays to shop around. Get the names of companies or brokers who specialize in your type of business. Call several so that you can compare prices and get a feel for the types of services they would provide.
   It’s also important to pick a company that is financially stable. Check the financial health of insurers with rating companies such as A.M. Best and Standard & Poor’s and consult consumer magazines.
2. Choose a higher deductible.
   Deductibles represent the amount of money you pay before your insurance policy kicks in. The higher the deductible, the less you will pay for the policy.
3. Buy a package policy.
   It can sometimes be cheaper to purchase a package policy, such as a Business Owners Policy (BOP), rather than individual coverages. A package policy provides standard coverages and limits of liability that are appropriate for typical small-to-medium-sized businesses.
4. Work closely with your agent or broker.
   Your insurance professional can provide invaluable advice to help protect your business from unexpected disasters. But you need to keep him or her informed about any major changes in your business. This includes major purchases, expansions or changes in hiring or the nature of your operation. Also, get your agent’s advice in terms of disaster planning. Ask what you can do to both reduce risks like fire or work-related accidents, as well as the procedures that should be in place in case your business does suffer a major catastrophe.
   Having the right coverage and a well thought out disaster plan can save you money in the long run. It may even save your business from going under.
5. Ask about ways to prevent losses.
   You may be able to reduce your premium for certain coverages by following your insurer’s recommendations. These can include workplace safety, disaster preparation, and human resource intervention.