There are a number of common mistakes some businesses make when it comes to purchasing commercial insurance. Insurance is the product you buy in case the unexpected happens. Unfortunately, by the time you need it, it's too late to make sure you have the right type and amount of insurance coverage. Agents educate your clients on how to buy insurance the right way.
Having two agents is better because they keep each other competitive
Having two agents duplicates effort and can create coverage gaps. For example, there are certain coverage’s that can be included under a liability policy and auto policy. One agent is better able to manage your entire insurance program.
The lower the premium the better
Premiums are determined by a combination of exposures and coverage. If you get a lower premium you may be missing needed coverage. For example, does the lower premium include replacement cost coverage on buildings and equipment?
Buying from a national company is always better.
Don’t listen to entertaining advertising on TV. Most national agents only represent one insurance company. They can’t shop your account to determine the best combination of price and coverage.
The internet is a great place to get good insurance deals
Low-cost internet insurance usually allows you to select the coverage and limits you want. But in most cases you end up with a limited and inadequate program. You find this out after you have an uninsured claim.
Umbrella insurance is only high net worth companies or individuals
A small electrical contractor was at fault for the total loss of a historic property, a loss that exceeded his general liability policy. The contractor’s umbrella paid the loss in excess of $7,000,000. Umbrella or excess coverage is some of the least costly insurance you can buy. Don’t risk a lost for a little expense.
I don’t need employment liability insurance, I only have five employees and they are like family.
This is the fastest growing area of litigation for small business. The average claim cost in 2011 was $75,000.
Not knowing your policy
Consumers' biggest mistake is not knowing what's in the fine print of their policies. Take time to read the policy. Ask your agent to meet with you at least annually to review your coverage.
Flood insurance is only for business in high risk areas
Big mistake; we recommend you ask for a flood quote to at least review the cost benefit of the coverage.
I don't need disability insurance because I can get Social Security
Don't count on Social Security to take care of all your needs if you become disabled. The cost is not as much as you may think.
There isn’t anything I can do to manage my insurance costs except shop price
There are many things you can do to reduce your premiums, here are a few:
- Consider increasing your deductibles
- Consider the vehicle model when make a purchase, some are more expensive to insure
- Add smoke and security alarms to your office