If you own a small business and haven’t given your insurance policy much thought, it’s time to change that. For example, do you know if you’re paying too much, or too little, for business insurance? Do you know the details of your policy or are you simply hoping you have all the coverage you need?
Below are 8 common insurance mistakes business owners make, and how you can avoid them.
Not keeping your insurance company in the loop
Whether you’ve hired a new employee or begun offering new services, it’s important to alert your insurance company to any new changes. That goes for moving to a new location or when you purchase new equipment as well. To do this is simple: just give them a call or send an email.
Going with the cheapest insurance policy
While it might be tempting to save money with a bare bones policy, it’s usually not a good idea. If you’re under-covered when you need to file a claim, you could end up paying out-of-pocket when you exceed your (low) coverage limit. So that cheap insurance policy wasn’t cheap after all.
Not having enough coverage
This is different than going with the cheapest plan. Sometimes, business owners can be surprised to learn that they don’t have enough coverage when it’s time to file a claim. This is another reason why it’s important to work with an experienced insurance agent who can explain cost differentials and make sure your business has the coverage it needs.
Paying for what you don’t need
On the other hand, you should never overpay for business insurance, so make sure your policy doesn’t include coverage that you don’t require. Instead, go over your policy with your insurance agent, who can help you choose the best plan for your business. The more you save on insurance, the more you can invest in ways to grow your business.
Failing to know the details
Most insurance policies come with pages and pages of details, and while most insurance agents find them interesting reads, many business owners do not. Still, it is very important to go through your policy, read it thoroughly, and ask questions about anything you don’t understand before signing on the dotted lines.
Not having a risk management plan
Risk management initiatives keep your business and your employees safe, and they can help lower your insurance premiums, too. Depending on your business, you could install security systems, invest in training programs for your employees, install handrails and have clients sign contracts.
Not having workers’ compensation insurance
Yes, workers’ compensation can be expensive, but not having it can cost you even more. In fact, one of the costliest risks to businesses is employees getting injured on the job. If you don’t have workers’ comp when one of your employees gets hurt while working, you could end up paying their medical bills out-of-pocket.
Not having a business owners’ policy
In addition to having business insurance, it’s a good idea to consider a business owners’ policy for additional protection. Most business owners’ policies include commercial property insurance and general liability that can protect you from third-party injury and advertising injury, for example. Business interruption service will protect your business if it is destroyed in a storm or other catastrophic event.
If you’re concerned about making business insurance mistakes, or if you’re ready to discuss your insurance needs with an agent, contact the team at Roehr Insurance Services Agency. We’ll make sure you have the very best policy for your business.
