Small businesses form the bulk of businesses in the country. They employ a large fraction of the population and have a high output, which means they make significant contributions to the country’s GDP. That is why every government must pay attention to small businesses. It is important to note that small businesses usually face a myriad of challenges. Failure to overcome those challenges often leads to business failure. Therefore, business owners need to learn about the common challenges faced by small businesses and put in place measures to protect their businesses. One of the most important measures that business owners can take is buying small business insurance.
What is Small Business Insurance?
This is an insurance policy that has been customised to meet the needs of small business owners. They cover different aspects of the business. For instance, they offer commercial property insurance, product liability insurance, income protection, and errors & omissions insurance among others. They cover every risk that a small business may be exposed to. Since different types of small businesses have different coverage needs, these policies can be adjusted to meet the needs of the client.
While many insurance companies exist, business owners should give priority to insurance companies that focus on insuring small businesses. After all, they have a better understanding of the coverage needs of small businesses. Below are tips to help small business owners find the right insurance policy for their coverage needs:
1. Choose the Right Insurer
Insurance companies usually offer different types of insurance policies. For instance, you will find an insurance company that focuses on health insurance, home insurance, auto insurance, and so on. To get the best insurance policy, therefore, you must look for an insurance company that has focused on insuring small businesses. Be sure to create a shortlist of those firms and compare them based on reputation, quality of customer service, financial standing, and products they offer.
2. Consult a Business Insurance Broker
Insurance companies are usually too large to take care of the needs of small customers. To solve this problem, insurance companies work with insurance agents or brokers. When looking for a suitable insurance policy for your business, be sure to consult a licensed insurance broker. To get the best results, consider only working with independent insurance brokers. The beauty of consulting a broker is that they can assess the coverage needs of your small business and advise you accordingly on the type of policy you require.
3. Look at the Liabilities Covered
Before paying the premiums demanded by an insurance company, you must first do a little bit of research to find out what the policy covers. You want a policy that protects business property from damage, loss, or theft as well as protects you from lawsuits emanating from defective products and other claims made by consumers. You must read the policy document to ensure that the policy covers everything you want it to cover.
4. Check Liability Coverage Limits
It is not enough to make sure that a policy covers everything you want it to cover. You must also pay attention to the coverage limits. The liability coverage limits will tell you how much the insurance company will pay out in case you make a claim. You want a policy with sufficient liability coverage limits. For instance, if the value of items in your business premise is $1 million, the ideal policy should provide at least a million dollars in commercial property coverage.
5. Go Through the Exclusion and Inclusion Clauses
Insurance policies do not usually provide blanket coverage. They only cover the liabilities listed in the policy document. For this reason, you must read the inclusion clauses to find out exactly what the policy covers. The exclusions, on the other hand, will tell you what the policy does not cover. This will help to prevent any misunderstandings.
6. Compare Premiums
You want to get the best coverage at the lowest cost. Therefore, you must do a comparison of the premiums charged by different insurance companies. You’ll first have to identify suitable insurance policies before you can request quotes and do a comparison. This may take time, but the cost savings you’ll make are worth it.