More than just helping to cover costs that are associated with property damage and liability claims, business insurance will protect your business, your employees and even your customers. But with the number of coverage options offered by insurance companies and each of them telling you how theirs is the best deal you can get, you can easily get misled.
However, even if finding the right business insurance can seem tough, it’s really not that complicated. When shopping around for the right policy, you simply need to beat the following 15 points in mind (These are pitfalls you want to avoid when you are trying to buy the ideal business insurance for your business):
Mistake Nº 1: Buying the Least Expensive Policy
Watching your bottom line must not lead to you seeking out the cheapest options out there. If you buy a policy based on price rather than value, you run higher chances of landing in hot water when it comes time to file a claim.
Mistake Nº 2: Getting the Business Description Wrong
If you are requesting a quote online, you’ll probably have to fill in a form. Online forms typically have drop-down boxes with generic business descriptions. Getting this wrong will also mean getting an a quote for a policy that doesn’t cover all the activities of your business.
Mistake Nº 3: Not Getting Enough Property Insurance
You should be aware that getting an insurance without the adequate limits means that there’s a possibility that the disbursement you get won’t cover the totality of the replacement cost or the repair cost. This is simply because the insurance company will only cover the amount you insure and won’t cover the loss in full if the replacement and repair cost exceed that limit.
Mistake Nº 4: Not Including Business Interruption Coverage
If you want soundproof cyber protection for your business, you must not fail to purchase a cyber policy that includes business interruption coverage. You might have to pay a additional premium for that, but it will be worth it as business interruption for a small business can be disastrous.
Mistake Nº 5: Not Having Sufficient Disaster Insurance
As mentioned above, not getting the right insurance will only put you at greater risks. While you may want to limit your expenses, you should ensure yourself against threats that can damage your business the most.
Mistake Nº 6: Choosing Low Deductibles by Default
This one is just as bad as the first mistake mentioned above. The reason why you must avoid automatically purchasing damage insurance with low deductibles is that you may be buying more insurance than you need.
Mistake Nº 7: Not Adjusting Your Coverage
As your business changes over time, so will your needs. And it is inconceivable that business owners don’t do the same for their coverage. Remember to reevaluate your insurance needs several months before the renewal of the policies.
Mistake Nº 8: Not Reading the Policy Carefully
If you don’t read the policy well, you will not be aware of the numerous warranties and conditions precedent mentioned in it. This, of course, means that there’s greater possibility of your business not complying with those. And non-compliance usually leads to a claim being turned down.in the worst case scenario, the entire policy can be invalidated.
Mistake Nº 9: Failure to Thinking About Health Insurance Options
You don’t have to wait for the renewal period to discuss health policies for your employees. Discuss your needs with your insurer and let them advise you on what’s best for your business and employees.
Mistake Nº 10: Not Willing to Change Insurer
Even if you have a great relationship with your current insurance company, it doesn’t mean you have to stick with them year in year out. Shop around and see if there are other insurers who can offer you better policies.
Mistake Nº 11: Not Purchasing A Policy that Covers for Online Sales
If you want to break into e-commerce to expand sales globally, think of getting a product liability insurance before. It will help protect you against expensive lawsuits over defective products.
Mistake Nº 12: Not Going to Right Broker or Agent
Considering that the broker will get commissions on the premium you purchase, it is important to find one that works for you and who is willing to meet your specific needs.
Mistake Nº 13: Not Listing All Entities or Locations
Since the majority of policy cover only entities that appear in the declarations, failing to accurately list all entities or location on the policy means that these entities will not qualify as named insureds.
Mistake Nº 14: Not Investing in Cybersecurity Insurance
That’s something you don’t want to overlook as more and more small businesses fall victim to data breaches and cyber hacks every single year. In the event of a breach, a cybersecurity insurance will protect the costs of your data and will also help cover the legal and technical costs of rebuilding.
