Tips For Understanding Commercial Insurance Quotes
When it comes you running a small business commercial insurance is essential. The first step is getting yourself an insurance broker who specializes in your area.
Commercial insurance is like a lot of things in life, you’re going to get what you pay for. Picking the quote with the lowest rate may seem like the best idea in the short term because it’s saving you money upfront. Then when it comes time to make a claim you may find you’ve short-changed yourself are stuck exposed to all kinds of risks you didn’t think about.
Before we get too far, let’s go over some terms you’re likely to see in your quote.
Terms To Know
Deductible - Even people who aren’t too familiar with insurance know about deductibles. They’re the amount you’re going to have to pay out of pocket in the event of a claim. Higher fees can lead to a lower deductible.
Per-occurrence limit - This is the limit that you’re policy is going to pay you out for a single claim. You’re going to want to make sure this limit is high enough to cover the potential fallout from something going seriously wrong at your commercial operation.
Aggregate limit - The total combined amount of payouts for a set period of time. This set time is usually a year but that’s something to check. Just like the pre-occurrence limit you should make sure that this covers costs. When it rains it pours and you’ll want to make sure your commercial insurance covers you for these potentially business ending scenarios.
Quotes Aren’t Final
It’s also important to remember that a quote isn’t final. They’re going to be close and give you something to work with and budget around but things can change a bit before it’s all settled. To get the most accurate quote you should make sure you’ve provided the most accurate information.
Check the Details of What Your Quote Actually Covers
Make sure you read carefully to know what you’re actually going to cover for and compare it against not only what you’re doing now but where you want your business to go in the future. You don’t want to be stuck in a scenario where you can’t secure a major client because you don’t have the right coverage.
How To Compare Quotes So You’re Getting What’s Best For You
Once you know what you need to be covered, make sure that you’re comparing these parts of the different quotes. Some quotes are going to combine general liability insurance with property insurance, some will keep these separate.
When weighing your options make sure you’re not missing out by not bundling your services. Remember, the goal here is to have coverage for the risks your current and future business is going to be exposed too.
How Often You Pay Matters
Most policies are going to give you the option to make one large payment upfront or space your payments out over the year into 2, 4 or 10 payments. If you have the cash on hand it’s a good idea to pay the whole cost upfront.
If, on the other hand, you need the insurance coverage to secure clients and jump-start your cash flow it might be best to go with lower, regular payments. While that might end up costing you more in the long run, it gets you moving now.
When it comes to getting commercial insurance for your business, it’s your job to know your business, but working with an insurance broker is always a good idea. It’s your broker’s job to know the insurance business and help you get the quotes to make the right choice for your operation.