How to Choose the Best Business Insurance Policy
Choosing the best business insurance policy does not have to be difficult or expensive. Your goal should be the best coverage available at a price your business can afford. Here are some tips for choosing a policy that accomplishes your twin goals:
Address Your Main Concerns
No one knows your business better than you. Before purchasing a business insurance policy make a list of your major insurance concerns i.e., adequate limits of liability, loss of income, etc.). Review each policy to see how each addresses your primary concerns. By completing this process you will be in a better position to review your options and choose the most suitable coverage.
Review Policy Limits and Deductibles
When choosing a policy you'll have to look at the numbers to weigh your financial exposure and risks. Review the policy limits and make sure limits for property and liability are sufficient to ensure that should the worst happen your business is protected.
Review all deductibles within the policy and make sure you can handle the out-of-pocket expense. Typically, the higher your business insurance premium the more coverage you'll have in the event a claim is made against your policy. One way to save money is to choose a policy with a lower premium, but keep in mind that this made increase your exposure and risk in the event of a loss. Consider a policy that allows you to raise deductibles if you're comfortable with the increased risk.
Review Who Is an Insured
An "insured" under your business insurance policy is any person or entity to which your insurance applies. Consider all those with an interest in your business insurance coverage e.g. employees, partners) to ensure they are a named "insured" under the policy. A competent attorney can help review your policy to ensure you have comprehensive coverage.
Insurance policies often include limitations on the number of days certain coverage will apply such as the "period of restoration" under a business income policy) or how soon the policyholder must act before the conditions of the policy change. Scan the policy for time limits and ensure that you understand the policy's terms.
Consider the Company
Choosing the right business insurance policy may boil down to your relationship with the insurance company. Make sure the company's interests match yours. Are you interested in a long-term relationship? Research the company's financial strength to ensure that it will be in business for the long term. Are you a high-maintenance client? If so, make sure the company can handle your requests in a timely manner.
Remember, the company you select is the insurance company that you will want to pay your claim if the worst should happen. Don't choose a policy offered by a company that does not make you feel 100% confident.
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