Every business owner knows that it is important to buy insurance to protect the assets from unexpected damage or loss. However, many entrepreneurs and small business owners either do not buy insurance or underinsure their assets because of the steep cost. Fortunately, there are quite a few things you can do to reduce the cost of your insurance premium. Some practical and effective strategies:
Compare Quotes from Different Insurance Companies
Very much like buying a car or a consumer durable, you can get the best rate by shopping around. The insurance business is intensely competitive, and all insurers try to lure new customers by giving attractive rates. If you are internet-savvy, you can access a comparison website that will generate quotes from various companies so that you can pick the one you like. However, if you want personalized service, you can ask your insurance broker to get you the best quotes from a few companies.
Opt For a Package Policy, Recommends the Eric Dalius Net Worth Tutorial
If you have added different assets at different times, you may end up with several policies that can be relatively expensive compared to a package policy with comprehensive coverage. For example, a business owners’ policy that includes both insurance for commercial property and general liability coverage can be cheaper than buying them individually. Many other individual policies for auto, inland marine, theft, etc. can be incorporated into a package policy with a reduced premium, according to the building primer.
Review the Insurance Schedules of Assets Covered
If you have included assets like cars and trucks in a commercial auto policy or office equipment, plant, and machinery, in an equipment insurance policy, you must make it a point to review the schedules every year when renewing the policies. If you don’t do this exercise, you could very well be paying a part of the cost to cover assets that you no longer own, resulting in the wastage of money. It is also important to review the value of the assets and take into account their depreciated value for calculating the insurance premium accurately.
Identify Overlapping or Redundant Coverage
Even though typically, commercial insurance policies do not duplicate coverage in other types of policies, sometimes there can be overlaps. For example, it is not uncommon for a general liability policy and a commercial automobile policy to cover the same assets, while computers, printers, servers, etc. may be included in the schedules of both commercial property insurance and electronic data processing policies. By examining your policy coverage in detail, you can eliminate overlaps and redundancies and lower your premium costs.
One of the easiest ways of lowering your insurance premium is to ask your insurance company about the discounts you are eligible for. You can also find out if paying your premium in advance for the entire year gives you a discount. Building in safety and security features can lower your perceived risk to events like fire and theft. It can result in the insurance company lowering your premium.