Did you know that 40 to 60% of small businesses collapse after a disaster? Unfortunately, most small businesses aren’t prepared for some of the eventualities responsible for small business closure. Besides natural disasters, your small business is prone to many mistakes and missteps that permanently cripple it.
Getting insurance services for your businesses should, therefore, be a priority. For most first-timers, choosing commercial insurance services can be a daunting process. If you’re in this space, our guide will prove quite resourceful.
Here are some of the top tips for choosing the ideal insurance for your small business.
1. Know Your Risks
Industries are different, meaning they are exposed to varying risks. You might want to research more about your industry and some of the potential risks. The kind of risk you’re likely to encounter when running a construction firm is quite different from what convenience stores go through.
Establishing the potential risk will help you know if you need protection against employee liability or property loss. Note your industry isn’t the sole determinant of potential danger. Your business’s location is a factor you shouldn’t ignore, as natural disasters tend to be pretty devastating for small businesses.
After a risk assessment, you’ll know if the general liability coverage is sufficient. It is crucial to cover your business adequately to avoid unforeseen closure. After you identify a potential risk, ensure you have obtained the right coverage as the losses after a calamity might lead to permanent business closure.
2. Get Quotes From Different Insurance Providers
If you’re keen on money management, getting competitive quotes for services should be on top of your list. Don’t settle for the first insurance provider you get. Some insurance services tend to overprice their products.
You’ll never get competitive prices unless you compare quotes. Request quotes from several insurance agents as you decide on the policies you need to get. Providers will have different costs and benefits, and you’ll need to explore more to know what’s best for your small business.
The extra benefit of consulting different insurance agents is you’ll understand more about your company’s potential risks. Most of these agents have experience dealing with other businesses, and they will be in a better position to know the ideal cover you need. While at it, you’ll get an opportunity to negotiate for better rates.
3. Consider an Agent Who Understands Your Industry
Insurance services for businesses can be confusing, especially for entrepreneurs who don’t know much about commercial insurance. You’ll never get all the answers you need even after weeks of researching. Getting an insurance agent knowledgeable in your industry is a great plus when looking for your small business insurance services.
With an agent who understands your industry, you’re likely to get the best rates. The agent will also guide you on the essential business needs you should consider and a workable plan. It would help to interview your identified agent to know more about their experience with small businesses in your industry.
You might want to work with an independent agent as a captive agent might only advise you as per the company’s policies. Independent agencies can also shop from different firms to get you the best deal. As with Signature Bank Insurance Services, they work with 40 carriers to find the right coverage for your needs.
4. Get a Scalable Plan
As your business continues to grow, you might want to consider paying off loans early. It would also help to evaluate processes and programs that will support your growth. The insurance services you choose for your business should be viable even as your business scales up.
Your growing business might cause you to need more coverage to insure the increasing risks. If you’re opening more locations and hiring more staff, your initial insurance will be inadequate. The insurance needs will escalate.
Is your provider able to scale with you? The commercial insurance plan you consider ought to be flexible enough to accommodate unanticipated growth. When shopping for insurance, keep in mind your business needs might change and you need a cover that will still be useful.
5. Read Your Policy Well
A recent survey reported that 91% of people consenting to terms and conditions don’t read them. This case also applies to insurance policies. Insurance services tend to have detailed guidelines that might not be comprehensible.
For some people, the language is quite complex, while others simply find the reading a bit exhausting. If you’re in this category, you might be in for trouble. Carriers have different deductibles, limits, premiums, and exclusions you’ll only know when you take the time to read the policy.
It would help to go through the policy with your insurance agent to clarify areas you don’t understand. You should never sign a policy without reading and understanding the clauses. Reading the policy will make it easier for you to identify gaps that might be problematic during the claim process.
6. Better To Be Over-Insured Than Under-Insured
For any business owner, cutting on expenses is a prudent move. While you want to save some dollars, trying to cut your insurance costs isn’t the best option. A cheap insurance policy might end up having low coverage and high deductibles.
Worse still, you’ll end up incurring high out-of-the-pocket costs if anything goes amiss. It is crucial to get adequate coverage based on your potential business risks. Never underestimate potential damage; it’s better to be over-insured than under-insured.
The price of business insurance might shock you, especially if you’re a first-timer. However, getting the cheapest offer shouldn’t be the solution. Prioritize getting the right coverage as it will help you save more in the long-run.
Insurance Services Are Indispensable for Small Businesses
With the kind of risks businesses face, being uninsured is one of the easiest ways to collapse your business. It is crucial to get the right insurance services based on your potential industry’s risks. Choosing the right commercial insurance will protect your business against any unforeseen liabilities.
Are you looking for the right insurance for your small business? Signature Bank Insurance Services has services to suit your diverse business needs. Contact us today to get the ideal coverage.