Partner Article

How to pick the right business insurance

As you decide to start and run a business, make sure you protect everything you invest in your venture, including money and time. By purchasing business insurance, you protect the personal assets from accidents, liabilities and potential lawsuits. As long as you manage to purchase the right package or plan, you ensure an extra layer of protection around your investment. An unexpected situation will arise when least expected. Believe it or not, it makes no difference how careful you are. Most business owners do not have the knowledge to adopt all the required safety measures, so a little education is vital. Understanding the main policies available on the market can help you buy the right insurance.

Policies

There are different policies you can purchase and each of them can cover multiple plans. For instance, you might choose an insurance to protect your goods against damage or natural disasters, including your building or equipments. There are also some policies against crimes. Thefts are the most common crimes, but an employee fraud may represent a much unexpected case. What about a lawsuit? A defective service or product can harm innocent people, so lawsuits may arise for a multitude of reasons. Protecting yourself for the expenses is a great idea in this case. Finally, never ignore your employees. A missing, disabled or dead key man can dig a hole in your budget, so try to take care of this aspect too.

Categories

There are four major categories business insurance can cover:

• Liability insurance – Pays for treatments, injuries or damages caused by the insured part.
• Property insurance – Compensates for all the financial losses caused by property damage, regardless of the responsible factors.
• Umbrella insurance – Implies extending the coverage for various aspects that are not too common. Such factors are usually specific for a niche, industry or business, therefore, they are not usually included in general plans.
• Auto insurance – Reimburses the insured part against the damage provoked by the vehicles owned and run for the good going of a business.

Although the list is longer, these four major categories represent the front runners among most business owners.

Making a decision

Aside from the type of coverage, you have to concentrate on the financial limits as well. The more you want to insure, the more money you will pay on a monthly or yearly basis. The premiums you end up paying for are highly influenced by numerous factors too. Ideally, you should compare as many quotes and packages as you can. Double check with the prestigious companies, but also the independent agents, Some of them give you the chance to ask for details over the Internet. Ask for recommendations from friends or other business owners too. In the end, you must find the best rapport for coverage and costs.

It is essential to understand what each policy implies. When checking out two different agencies, you may find the same name for various plans. However, the terms, conditions and investments are different. A few common names will randomly present the same thing, but this is not a general rule. Therefore, compare such details as well.

Try to be as honest as possible and include as many details as you can. Tell the respective agents about all the factors around your business. For instance, if you run a simple home-based business, you might be eligible for a different plan. Remember that it is not covered by most homeowner policies, but you may extend the current plan to include your business as well. Clearly discuss your situation in an attempt to find the best deal for you.

Common elements

Research the coverage each policy brings in. There are a lot of exclusions and elements you should consider before signing a contract. The endorsements, for instance, might require an extension. There are unique risks that do not apply to every business, so your plan has to be customized.

Covering the occurrences is just as important. A detailed and sophisticated package can cover the liability for absolutely any occurrence during the respective period of time. A few gaps in your policy can open a lot of back doors for the insurance company and increase your vulnerability.

The damage or problems that were actually expected are usually excluded. However, you do not need to rely on a weak policy and feel unprotected. The insurance company needs more than just one reasonable reason during a lawsuit for you to lose the case. In fact, it has to prove that you were actually thinking about the intended problems, which is almost impossible.

This was posted in Bdaily's Members' News section by steve hannigan .