How to Buy the Right Small Business Insurance

Man holding piggy bankOne thing is certain: business owners have numerous responsibilities. In these difficult economic times, they must do everything in their power to minimize expenses and boost their profit margins, without making any kind of compromises. For most of them, this seems like a mission impossible. If you are one of the entrepreneurs struggling to make ends meet, keep in mind that small business insurance represents an indispensable asset.

Why Do I Need Small Business Insurance in the First Place?

You can never know what may happen in the near future. Even if your company is financially sound at this point in time, tomorrow it could be impacted by an unexpected crisis, natural disaster, a fire or a burglary attempt. Since you cannot predict the future, it is always better to reduce risks by counting on small business insurance. The right type of policy can get you out of trouble and enable you to put your enterprise back on track after a disrupting event. For instance, business interruption insurance can cover your losses (expected profits, fixed costs, expenses associated with a temporary location and so on) after a calamity.

Of course, there are numerous types of insurance policies for small businesses, so finding the right one can take time. To simplify your mission, conduct an online search and rely on Insurance Quote Depot to get accurate small business insurance quotes and compare rates the easy way. This is only the first important step that you should follow to make an informed decision. Here are a few extra tips guiding you in the right direction, towards an affordable policy tailored to your needs and requirements.

Find the Right agent

While info available online can be very useful, it is still recommended to discuss your options with an experienced agent. Here is where it gets tricky: there are various categories of specialists that you could rely on, to pick the best insurance policy: independent agents, captive agents and risk consultants.

Independent agents (or brokers) generally represent more than a few carriers. They can make you tempting offers, but note that in some cases they might tend to recommend the carriers offering them the biggest commission and not necessarily the ones that work to your advantage.

Captive agents are loyal to a certain insurance company. Also, remember that in some cases, a rainy day fund (also known as an emergency fund) could be the best alternative to an insurance policy. In this situation, you should contact a risk consultant and ask him for advice. The main drawback is that risk consultants typically charge a lot of money, so their intervention only makes sense when you are actually involved in a high-risk operation. Decide what kind of agent you’d want to meet, select the best candidates based on their experience and trustworthiness and get started.

Picking the Right Policy

Finding a reliable agent may not be very difficult, especially since the insurance industry is an extremely competitive field of activity. After completing this phase, you’ll have to identify the most adequate policy for you, in terms of cost and benefits. If you are currently grossing an amount of money than does not exceed 3 million dollars, you could opt for a business owner’s policy (B.O.P.), an ensemble comprising a few business policies, which give you the freedom to add extra pieces and personalize it as you see fit, if necessary.

In case you are grossing more than 3 million dollars, it is recommended to buy all the pieces separately. There are 4 extremely important components that you couldn’t live without: property insurance, workers’ compensations, general liability insurance and business interruption insurance.

Property insurance policy covers the expenses triggered by potential damages impacting physical premises or your office equipment. Property instance rates vary a great deal from one insurer to another, based on certain factors, including location, the distance between your building and the local fire department, the age of your building and also the materials used in its structure (wood, cement, bricks and so on). To avoid miscalculations and unpleasant surprises, compare small business insurance quotes online and get additional details by contacting an experienced, respectable agent.

Furthermore, you have to invest in workers’ compensation, because this policy is required by law. It covers severe injury/disabilities pay, medical expenses recorded by your employees as well as death benefits. Costs associated with this type of insurance vary a great deal, based on the industry in which you operate and also based on the type of assignments that your employees are paid to complete on a daily basis. For instance, you could spend less than 30 cents for every 100 dollars of payroll for a secretary, while for a roofer you may have to invest more than 20 dollars for every 100 dollars of payroll. Obviously, the difference is justifiable: roofers are more exposed to considerable risks than secretaries.

General liability insurance is useful if your enterprise could somehow impact the health, reputation and/or property of other parties. Rates vary significantly, based on the size of your company, its number of clients and its revenues.

Last, but definitely not least, business interruption insurance is a piece of the puzzle that comes in handy and generates negligible expenses. Apart from the fact that it covers payroll costs and the value of the goods destroyed in the event of a calamity, it also enables you to get back on your feet sooner than expected, by offering you the financial support that you need to rent a temporary space and office equipment.

Clearly, there are various components that could help you attain peace of mind, knowing that your small business is out of harm’s way. To explore the most attractive deals, start by comparing rates online. With Insurance Quote Depot, you can get free small business insurance quotes with a few clicks. It’s as simple as it gets. This mechanism would allow you to get prepared for your next meetings with several insurers and make an inspired business decision.

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