When it comes to buying insurance for your business, what you don’t know could hurt you. The goal is for you to purchase an affordable policy that offers your business the protection it needs against risks and losses. Whether you are in the process of shopping for insurance before you start your business or currently looking for a new insurer, here is a list of dos and don’ts you need to be aware of.
Some of the things you will want to do, include:
• Analyzing your needs. Before you start shopping for insurance, it helps if you know what kind of business insurance you need. Ask yourself what areas of your business have the potential for loss. Consult with an attorney so you can better understand what kind of insurance policy you need for your business.
• Shopping around. It is much more beneficial for you to shop insurers than it is for you to choose the very first one you come across. Different insurers offer different types of coverage and rates. You should try to find a good insurer that offers you the most comprehensive package for a price you can afford.
• Reading through all insurance documents thoroughly. Ask questions if you don’t understand something. Failure to read over all information could result in you being underinsured.
• Choosing an agent who makes you feel comfortable. They should be attentive to your needs and willing to accommodate you as much as possible.
• Working with an agent who can cover all of your personal and business insurance needs. Some insurers provide both personal and business insurance and offer discounts for customers who bundle their policies together, resulting in bigger savings.
• Getting coverage for employment practices. If your business has employees, be sure to include employment practices liability coverage. Also, don’t forget to cultivate a healthy and happy workplace to attract new employees and to help you to maintain your current ones.
• Asking questions. If you don’t know what kind of policy you need or you have concerns, don’t hesitate to ask the agent for more information. You should never purchase business insurance if you are not sure about what’s covered or how to get sufficient coverage. If any agent brushes your questions off or leaves you feeling more confused, you should consider looking elsewhere for coverage.
• Keeping your agent informed of any changes to your business. Failure to do so could result in your coverage being dropped because you intentionally misrepresented your business. You should also inspect your policy periodically to ensure your coverage is up to date.
Along with what you want to do, there are things should not be doing, such as:
• Withholding information. Insurers use your company’s financial profile to determine the amount of coverage they are willing to extend to protect your business. Provide them with all of the necessary documentation they need. This will also enable them to make decisions about your coverage much faster.
• Choosing an insurer with bad ratings. Some business insurers have poor ratings. Always pay attention to the rating of insurance companies you come across so you know which ones to avoid.
• Neglecting to purchase a good policy. Some insurers offer packages, and others allow you to tailor your policy to your needs. Although they may be a cheaper and more affordable option, packages may not offer your business the kind of protection it needs. Choose an insurer that allows you to customize your policy to prevent gaps in coverage.
• Underinsuring. Always double check your policy to ensure that you are properly covered. All too often business owners purchase insurance only to find out they are underinsured later. Before you sign any documents, read through your policy carefully to ensure there are no clauses that limit the amount of your coverage.
Use the above list of dos and don’ts to make your business insurance purchasing experience easy and stress-free.
The content on our website is only meant to provide general information and is not legal advice. We make our best efforts to make sure the information is accurate, but we cannot guarantee it. Do not rely on the content as legal advice. For assistance with legal problems or for a legal inquiry please contact you attorney.