10 Ways to Save Money on Business Insurance
1. Shop your coverage with local independent agents, such as Beathard Insurance and remember:
Commercial insurance providers evaluate risk according to algorithms that can spit out very different quotes from the same information. That means you could find substantially lower rates than what you're paying without changing your coverage simply by shopping around.
How often should you shop your business policy? Some financial experts recommend you do it annually, while others recommend at minimum every three years. One thing to consider: Some insurance may carriers offer loyalty bonuses and claims free discounts. See if yours does before you make a decision to move.
2. Bundle coverages with a Business Owner's Policy (BOP).
A business owner's policy combines several common types of protection together (e.g. property, business interruption, and some liability) into a single plan, much like a personal Homeowner insurance policy does and often at a lower price than the business owner could get by shopping for the coverages separately.
Ask coverage questions carefully before you sign. Many BOPs don't include auto insurance or professional liability insurance and don't cover workers compensation. You could need separate policies for these coverages.
3. Consider a different kind of bundle
Insurance companies often provide price breaks when you buy multiple lines of coverage. If yours does, you could save by purchasing your business property and liability, as we as your commercial auto and workers compensation coverages from the same carrier.
4. Evaluate your protection and your risks
Take a thorough look at your policy and make sure you don't have coverage you don't need. If you don't use a vehicle for your business, for example may not need commercial auto insurance. If you don't have employees, you don't need employment practices liability coverage bottom line; make sure you're not insuring yourself for a risk you don't face. To avoid this over insuring mistake, consult with a local professional independent insurance agent, like Beathard Insurance.
5. Increase your deductible
Many policyholders of all types don't realize the relationship between their deductible and their premiums. In a nutshell, all other factors being equal, the lower your deductible, the higher and your premium.
So a good way to lower your premiums is to raise your deductible. However, remember that you'll have to pay that deductible before you receive any help on a claim, so make sure you set it at an amount that you can come up with in a hurry.
One other benefit: the higher deductible will discourage you from filing smaller claims. Determine how much of a deductible you or the business can tolerate and make a decision upon that. Remember, for every year you don’t have a claim you’ve saved money because you didn’t have to meet a deductible.
6. Does your company offer a claims-free discount?
Carriers love policyholders who don't file claims. If your business has been claims-free for a period of years, you could be eligible for a discount. This is why it's a good idea to avoid filing smaller claims. Before your current insurance is set to expire, ask your company to provide you with your company’s loss experience and be sure to present this when getting a quote from a new agent. In Texas all companies that sell commercial insurance must provide “loss runs” to their insureds.
7. Ask about loss-prevention programs
Will the carrier inspect your operation and recommend ways you can reduce risk in your business? These could include such things as starting a workplace safety program, instituting disaster preparations, and initiating a theft-prevention plan and spreading your inventory exposure to more than one single location. All these will reduce the risk of a claim, and might get you a price break. It could also help in determining if you should change a deductible.
8. Change your payment method
This could vary by company, but you can reap substantial annual savings by paying your premium in full upfront. Commercial auto insurance providers, for example, can discount a year's premium by as much as 15% if they receive payment in a lump sum.
9. Look for Stability among Providers
All the ways previously mentioned to save you money won’t matter if you’re with the wrong provider. If you’re shopping for insurance don’t always take the cheapest quote you get because you could get burned when it’s claims time. Be sure to shop a local professional insurance agent that’s done commercial lines insurance for five years or more and is established in your local area and state. Ask the agent what the “A.M. Best rating” is for the company they are placing your coverage with. Best is a third party which determines the financial stability (ability to pay claims & stay in business) of the carrier.
10. Don’t treat your insurance as an afterthought.
By treating your commercial insurance as a planned expense and budgeting accordingly instead of as an afterthought, you might be able to reduce the amount you spend while maintaining full coverage. It takes a strategic approach to accomplish this mission, but it could well be worth it to your bottom line.
If you need help with your insurance or bonds, call the friendly staff at Beathard Insurance. We’re here to help!