An insurance cover is the best way to protect your small business from unforeseen circumstances such as accidents, loss of business, and employee injury suits. Read below to learn the various considerations you need to make when buying an insurance cover for your business.
Type of Business
Choose a cover that suits your business needs. For example, a doctor that runs a small clinic may not need a workers compensation cover. However, he or she may need a general liability cover to protect patients who visit the hospital. You also have to research what insurance covers are common in your industry. For instance, people in the service industry will take a professional indemnity cover while those that sell goods will need product liability insurance. For contractors, most clients will ask if you have a public liability cover.
Choosing an Insurance Company
Below is a guide on how to choose an insurance company.
- Conduct some research on the reputation of the insurance company. Avoid companies that do not compensate their clients.
- What is the company's financial status? Companies that have been making losses or those under receivership may be unable to pay out when claims arise.
- Insurance policies change frequently. Choose a company that regularly updates its clients on new trends and changing regulations.
- The insurance company should have a smooth claims process.
Some insurance companies combine several insurance covers under one package. The packages are cheaper since you pay a single premium as opposed to paying several premiums. For instance, some companies will combine public liability, general liability and professional indemnity covers.
Terms and Conditions
Inquire about the company's terms and conditions. Reputable companies will fully disclose the terms of their various products. For instance, for a workers compensation cover, most insurance firms will not pay if the employee suffered the injury off working hours. Such information is vital as it could help shape your work policy and prevent incidences of insurance fraud from your employees.
Insurance premiums are calculated based on the magnitude of your firm, the risks you are exposed to, the number of employees you have, and how much you pay your employees. Ask how and when you should make payments. Most companies have flexible plans where the yearly premium is paid in monthly instalments. Some companies will offer discounts if you refer a friend or if you consistently pay your premiums on time.
Choosing a business insurance cover should be easy with the tips above. Always pay your premiums on time; otherwise, the insurance company could fail to compensate you.
For more information on business insurance, contact an insurance company.