5 Steps To Choose The Best General Liability Insurance For Your Small Business
The best general liability insurance policies are designed to protect your assets by paying for obligations incurred if someone gets hurt on the property, by your product or when anyone employed by the business causes property damage or injury. They also cover legal defense costs and any settlement or award if the small business is successfully sued and the claim is valid.
Want the best general liability insurance for your business? Follow these five steps to secure the right coverage at a reasonable cost while minimizing your business risks.
5 Steps to Help You Get the Best General Liability Insurance for Your Small Business
Step #1 – Choose a Trusted Insurance Broker
As your broker will be responsible for bringing your risk to market, he or she must enjoy solid relationships with multiple stable underwriters. A broker who has earned your trust will put you and your business first by helping you to find policies matching your real business needs, while developing the most comprehensive and competitive insurance program available. The best insurance brokers will develop a strategy and market your business to insurance carriers based upon a high level of detail and knowledge, thus enabling qualified carriers to provide you with the best general liability insurance coverage and prices at a competitive price.
Step #2 – Analyze Your Business Risks
Insurance underwriters determine the level of risk they will accept when issuing your policy, after reviewing your application and determining whether it will provide all or a portion of the coverage being requested. As a result, it is critical your broker understands all your business risks.
See also: Watch our KMRD Assessment Process Video
Each general liability insurance policy includes a premium and a deductible. A premium is the price you pay for your insurance coverage. Premiums vary among insurance companies, and depend on a number of risk factors. These factors include business location, building type, local fire protection services and the amount of insurance you purchase. A deductible is the amount of money the insured agrees to pay when filing a claim. Generally, the higher deductible the insured agrees to pay, the lower the premium will be. However, by agreeing to assume a higher deductible the insured assumes increased financial risk.
Step #3 – Read The Entire Policy
It is surprising how often the insured and/or the trusted broker skip this important step. It is only by reading through the entire policy you and your broker can fully understand the extent of your coverages. Going back to Step #1, choose a trusted broker who puts your business first.
See also: Examine Your Insurance Policy Wording
Because some insurance brokers build business based on volume transactions, they will save time by not reading every policy they sell in detail. This is a perilous course of action, as each insurance policy is a contract between the insured and the underwriter outlining the limits of coverage. It is important to know these limits before an event occurs, and coverage limits are locked in.
KMRD Does More For You Than Place Coverage and Select Plans
Step #4 – What Is A Business Owner’s Policy?
Insurance can be purchased on an a la carte basis or in a package called a business owner’s policy (“BOP”). While purchasing separate policies from different insurers may result in higher total premiums, a BOP combines typical coverage options into a standard package. The BOP may be offered at a premium less than if each type of coverage was purchased separately.
Typically, BOPs include property, general liability, vehicular, business interruption and other types of coverage common to most businesses. BOPs can both simplify the insurance buying process and cost less. However, take note of the extent of coverage in any BOP because not every type of insurance is included. Professional liability, auto insurance, worker’s compensation and health and disability insurance belong to this group. If your business has unique risks, you may require additional coverage.
Step #5 – Review Your Insurance Coverage Annually
As your business expands and potentially changes with the addition of new products and services, so can your liabilities. Your coverage should expand and change along with these liabilities, or else you could be under-insured in the event of a claim. Contact your trusted broker to discuss changes in your business and how they affect your coverage anytime you purchase, upgrade or replace equipment, alter your product mix, add or change suppliers, expand operations or add practices.
Contact us below to have a KMRD expert provide you with the best general liability insurance policy.
Greg Gerber is an Account Manager at KMRD Partners Risk & Insurance Solutions, a leading risk management and human capital solutions firm based in Warrington, Pa.
The content available on or through this e-letter is in no way intended to and shall not be construed to constitute professional medical, health, legal, tax or financial advice. KMRD Partners disclaims any liability or loss in connection with the content contained in this e-letter.
How KMRD Can Help:
KMRD delivers risk management and human capital solutions to over 2000 clients nationwide. Our award-winning team, disciplined approach, proven processes, combined with our risk management portal make KMRD the leading choice to improve general liability protection and reduce the overall cost of risk.