Six Questions to Ask Before Getting Small Business Insurance

The newness of starting a business is exciting, while the unknowns and risk can cause stress. One way to alleviate some of the stresses associated with starting a small business is to seek out and purchase the appropriate insurance for your small business. Knowing you’re covered will give you peace of mind, and help you rest easier at night, but before you look for small business insurance quotes online, here are six questions you need to ask.

When Will My Business Begin and End?

Having an accurate view of when business activity begins and ends is crucial to establishing your insurance policy. It will also ensure that you don’t go a day without coverage or end up paying premiums longer than you need to. For a small business with low premiums this isn’t that big of an issue, but for a larger business with high premiums, an extra payment or two can represent a decent amount of money.

What Type of Business Do I Operate?

Regardless of similarities or industry field, each business faces different kinds of risks. While the type of business you operate will affect how much you pay, being classified correctly means you won’t end up paying too much. It will also ensure you don’t suffer from a dangerous lack of coverage. For example a business that operates a fleet of tug boats will face greater risks than a business that delivers pizzas.

What Type of Work Will My Business Perform? 

Like businesses, not all work is created equal either. Your insurance rates and coverage limits will depend on a lot of different factors, but one of the main factors is the type of work your business performs. If the work is considered dangerous, your rates will be higher. Additionally, if you perform a special kind of work (i.e. high-rise window washing) you may need to take out a special policy designed to cover this type of work.

What is the Total Value of My Business Assets?

This is where making a list can really pay off. Businesses of all sizes own different equipment and as a result, have different insurance needs. For instance a small, one man printing shop may have $25k in assets while a multi-person law office may only have $10k worth. Making a list of everything your business owns is the only way to guarantee your equipment and supplies are insured against potential loss. This will also help your insurance agent determine if you need your coverage limits raised or lowered.

How Many Employees Do I Plan to Hire?

The more people you have working for you, the higher your payment for workers comp insurance will be. But not having sufficient coverage for your workforce could put you in a legal bind, so you don’t want to skimp on coverage to save money. Having adequate coverage is the best way to approach your insurance, especially when it involves the well-being of others.

What Other Forms of Insurance Do I Need?

Bundling insurance policies is one of the best ways for your small business to save money on insurance costs. To know what types of insurance you need, you’ll want to talk to an insurance attorney, or you can also click floridahomeclaim.com/miami/. Although you’ll want to keep your business policies separate from your personal policies, insurance companies will often give discounts to customers who bundle all their insurance needs under the same roof.

Do Your Homework!

If you make a checklist, and read all of the insurance paperwork thoroughly, you’ll spare yourself any unpleasant surprises. Being able to answer the questions above before you commit to an insurance plan will prevent you from spending more than you need to, and prevent any gaps in coverage that might put your business at risk. You should also find that it helps make the process of securing adequate insurance for your new business straightforward and pain free.

—

Kevin Kerridge is the Director of small business insurance at Hiscox, a global insurance company with 100+ years’ experience.