Most company owners recognize the importance of carrying quality business insurance. These companies also need to ensure the policy they are purchasing is the right fit for their budget.
It is never wise to reduce the quality or amount of insurance protection a company maintains in order to save costs. But, there are ways to reduce premium costs to more effectively meet budget needs.
#1: Take Steps to Reduce Risk
The easiest way to keep costs down is to minimize the risks your business faces. Put in place a risk review to look at troublesome scenarios. Then, put a plan in place to avert these crises. By reducing your risk quotient, you also reduce the likelihood of claims — and the associated insurance rate increases.
#2: Ensure Your Employee Categorization Is Accurate
Workers compensation insurance is a key component of business insurance coverage. If an employee gets sick or hurt on the job, you’ll likely need to compensate that employee while they recover.
Categorize your employees to ensure they are properly represented within the plan. Ensure accuracy throughout this task, and make sure you do not downplay the risks your employees face. Revisit this process over time as you experience employee turnover.
#3: Amp Up the Security
Another way to reduce costs is to beef up your security. Take steps to protect:
- The building and its contents — such as inventory and computer systems
- Your customer data
- Employee data
- Your vehicles
- Any offsite equipment or inventory you maintain
If you can reduce the risk of loss for these items, it will likely impact how much you pay business insurance.
#4: Purchase a Business Owners Policy
Many small businesses can purchase a Business Owners Policy (or BOP). This packages combines the most common types of coverage into one policy. There is still plenty of customization, but the overall cost remains affordable.
That said, you should always ask your agent if a BOP is right for you. You might need special coverage which falls outside the realm of BOP offerings.
#5: Analyze Your Policies and Risks Annually
Work with your business insurance agent to go over your company’s policies on a routine basis. In doing so, you can make adjustments to coverage to ensure it is the right fit. After all, there’s no value in having too much protection or coverage on assets you no longer own.
An ongoing review of your risks can also be important. It can point out areas of your business no longer considered high-risk.
Reducing the cost of business insurance does not have to be a complex process. Most often, you can find ways to reduce premium costs simply by working with your agent.
We have coverage for you. Call Pan American Insurance for a free business insurance quote.