Business insurance is crucial if you are to protect your company from unforeseen forces in the future, whether they take the forms of fraud, fires, floods, plumbing problems, or a whole host of other potential issues. However, buying the right business insurance is rather difficult, as you need to know exactly what your business is most vulnerable to. Although you could buy an expensive catch-all policy which covers everything under the sun, the premiums may bankrupt you before you even get going!
So how do you choose the right business insurance? Here we offer you some advice.
Think about your specific risks
According to various professionals who have worked in/with the insurance industry, you mustn’t give in to exaggerated fears, but fears which make sense for your industry of choice. Before you go looking for business insurance, do your homework on what perils and risks businesses in your industry usually face. This allows you to base your policies on existing data, meaning it is more likely to be relevant to you one day. For example, if you’re opening a coffee shop and you find that a lot of coffee shop businesses have to claim for problems with their plumbing due to enhanced water usage, be sure to include this in your policy.
Belinda Pillow, a former insurance salesperson, recommends that you call your relevant trade association. She explains: “ask for any risk assessment tools for, papers on, or expert opinions about your particular industry.” This information should guide you toward common types of coverage which are commonplace in your industry, providing you with good guidelines for your own coverage. Nevertheless, there can always be loopholes and confusing jargon buried within business insurance policies, so be sure to speak to an agent or legal advisor before signing off on all of the terms.
Cover yourself for the basics too
Basically every business requires workers’ compensation insurance, although the guidelines differ slightly from state to state, sometimes excluding smaller businesses. Workers’ compensation covers things such as rehabilitation, lost wages, and medical expenses if one of your employees injures themselves in your workplace. Furthermore, in the unlikely event that they die on the job, it will pay death benefits to their named beneficiaries. You don’t necessarily have to cover yourself too, but it’s probably a good idea, and it’s usually very cheap to do so.
Also remember to purchase property insurance, which protects buildings and contents, and is crucial for smaller businesses in times of disaster. Bear in mind, however, that some things such as “acts of God” and utility failures may be excluded from this policy. You should also purchase general liability coverage if you can, as this protects you if a member of the public injures themselves in your business and sues you, with the policies usually covering you for costs up to $1 million.
You can also get business insurance policies which feature a combination of these property and liability insurance models, providing you with a basic umbrella business policy. However, as with any policy, you should be sure to check the wording and confirm that there aren’t any hidden terms or clauses which could be difficult in the event of a claim.
Buy from an independent agency
Buying from an independent insurance agency means that you can shop between multiple carriers, looking for the best rates and coverage options. This is a great way to look for business insurance, as you are working with an unbiased party who can offer you bespoke advice and compare various deals from different insurance providers.
Insurance agencies also have the knowledge and expertise to explain different policies to you and explain why one policy may be more valuable than another despite not seeming so on the surface. Independent agencies are also likely to have experience working with other businesses in your industry, giving them a good idea of what kind of protections your business requires in order to operate safely and not go broke in the event of a claim.
If you’re looking for business insurance which is right for you and your industry, contact us today! We have years of experience in matching businesses with their perfect insurance policies, putting the busy minds of entrepreneurs at ease!