Commercial insurance is customized according to the unique needs of every business. No two law firms, for example, are exactly the same, as different firms take on different types of clients and cases. Although many business owners don’t revisit their insurance policies often, it’s advantageous to keep your insurance updated as your company evolves.
Here are a few reasons why you may need a commercial insurance review.
CHANGES IN THE SIZE OF YOUR BUSINESS
One of the main reasons to contact your insurance agent and conduct a commercial insurance review is if the size of your business grows or shrinks. Your liabilities will naturally increase in proportion to the increase in your scale of operation, followed by an increased workforce, especially in a factory environment. Conversely, if your business shrinks in both workforce and revenue, it’s an opportunity to lower your insurance rates.
CHANGES IN LOCATION OR BRAND OFFERING
Another reason to review business insurance is if your company has changed its location, products, or services. Sometimes these changes reflect an updated business model. For example, many companies chose to go more digital because of the pandemic and promoted remote work to ensure social distancing. This action could conceivably lower insurance rates since it leads to fewer people in the physical workplace and fewer chances of workers getting injured or ill on the job.
Moving to a new location can affect commercial insurance rates, partly based on crime statistics in zip codes. Relocating to an area with lower crime activity could mean lower insurance rates due to less exposure to burglaries. The lower your exposure to perils, the better chances you’ll have at lowering insurance costs. Moving near a fire station is also viewed as reducing risks.
If you introduce a new product or service, the question arises as to whether it’s produced through a safer process. If so, it can mean savings in commercial insurance costs. Rates may also come down when a company ceases to manufacture its own products and switches to partnering with a third party for production work.
ADDING NEW EQUIPMENT
When you purchase new equipment for your company, it can result in higher insurance rates, provided the use of such equipment requires training employees to perform more dangerous work. On the other hand, rates can come down if the equipment ensures a safer workplace. Adding vehicles to your fleet likely means you’ll pay a higher premium, whereas reducing vehicles can help cut costs.
All vehicles used for business must be reported to your insurance agency. You must also report any modifications made to vehicles. Keep in mind commercial auto insurance is very different from personal plans.
RISK MANAGEMENT IMPROVEMENTS
Setting an agenda to reduce workplace risks is perhaps the most powerful way to take more control of your commercial insurance rates. Ask your insurer about its risk management consulting services to help you with suitable changes in your insurance costs. Think about ways that reduce the chances of employees slipping and falling at work. Another concern should be improving ventilation for better air quality, which directly affects one’s overall health.
The idea of going more digital is quickly gaining popularity as companies look for ways to stay in business during the pandemic. You’ll still be serving customers, but outside of your physical establishment. Another benefit of going digital is that employees can work at home on their own computers, which diminishes the need to invest in equipment that eventually requires maintenance. Just be aware of the cybersecurity dangers that increase with greater digitalization. Consider the different types of insurance offered to protect computer equipment and overall operations in the event of a network breach.
HIRING NEW EMPLOYEES
A new addition to your business means that you have something extra that needs to be kept safe. If you have hired a new employee, you must ensure that their safety is maintained. Sit down with your licensed insurance professional and review your existing business insurance policy to ensure that your business adheres to all necessary legal requirements, such as workers’ compensation laws.
WHEN A BUSINESS PARTNER QUITS OR PASSES AWAY
There might come a time when your business partner separates from the business or passes away. In such situations, review your business insurance policy and ensure that they are no longer covered by the same.
These are some of the reasons why you may need to review your commercial insurance coverage. Contact us at 01 Insurance for further details on how to get the appropriate coverage for your business needs. We are ready to help you with all your insurance needs today.