As a business owner, you have a lot on your plate – from managing day-to-day operations to overseeing finances and ensuring customer satisfaction. With so many priorities to juggle, it’s easy to overlook something as crucial as your insurance policy. However, taking the time to review your policy details and coverage options can offer significant benefits for your business.
And what better way to do so than by working with one of our experienced insurance agents? In this blog post, we’ll explore why a policy review with our agents is a smart choice for business owners looking to protect their investments and ensure they have the right coverage. So sit back, grab a cup of coffee, and let’s dive in!
I recently had an opportunity to work with a large farming account who has been working with the same broker for many years. Part of the fun is peeling back the layers and learning about what’s working, what is not working and how we can help protect their operations.
My initial meeting went as expected, the insured stated their broker has been great, answers their call and handles issues as they arise. This is far too common, and something that I enjoy exploring with new prospective clients. It’s very common to hear from our prospective accounts their broker is reactive instead of being proactive.
After our first meeting we received copies of the insured’s policies. Here is the good part of what we discovered during our meetings-this client was insured with one of the best insurance carriers available in our industry. Their insurance product is top notch, and their customer service is excellent. There really shouldn’t be any issues from an insurance carrier standpoint. Not every meeting needs to be about the bad, and we should celebrate the good.
Commercial Insurance Review
After reviewing the insured’s commercial insurance policies, and learning more about their operations, there were two major discoveries:
First, their estimated gross receipts on the current policy were reported as roughly *$4,000,000 LESS* than what their actual gross receipts were. They were very surprised to learn this discovery will result in the insured owing nearly $50,000 additional premium at the year end final audit.
Second, we also identified over 20 pieces of equipment that were currently on the policy, these items were all valued under $10,000. Here is the interesting part, they had *NO *coverage for those items. The reason is simple, the deductible on the policy was set to *$10,000*. Imagine having nearly $150,000 worth of equipment with *NO coverage.*
Commercial Insurance Policies: What You Should Know
The insurance industry is flawed when it comes to selecting and purchasing insurance, which is why I discuss this issue head on with every new account I encounter. Business owners are trained to focus only on pricing and not the actual product that they are insuring. You can point blame at the big box brand carriers, their commercials about saving you money, but it ultimately comes down to some insurance brokers being lazy and not helping to protect their client’s business.
Business owners should consider annually reviewing their commercial insurance policy details, for several important reasons:
Cost Savings: By reviewing their insurance policies, business owners can identify areas where they are paying too much for coverage they don’t actually need, or where they are underinsured and could benefit from additional coverage. This can result in significant cost savings for the business.
Adequate Insurance Coverage: By reviewing their policy details, business owners can identify gaps in their coverage and make sure that they have adequate insurance protection for their specific needs. This can help prevent financial losses due to unexpected events.
Changes in Business Operations: As businesses evolve, their insurance needs may change as well. This is normal. By reviewing their policy details and comparing them with other policies, business owners can ensure that their coverage is still appropriate for their current operations, and make changes, if not.
Industry-Specific Risks: Different industries have unique risks that require specific coverage. A good insurance agent will go over your industry specific risks with you, so that you can inform them of any risks that an outsider may not be aware of. By comparing policies, business owners can identify specialized insurance products that are designed for their industry and provide more comprehensive protection.
Better Customer Service: Reviewing policy details can help business owners understand the level of customer service that they can expect from their broker. This can be an important factor when choosing an insurance provider, as good customer service can be critical in the event of a claim.
Exploring Your Commercial Insurance Policy
I challenge business owners and decision makers to consider making a change. Why should your attention be simply focused on price? Ask yourself, what is it exactly that you are insuring, and are you sure that you are insuring what needs to be insured, specific to your business needs and industry?
Let’s start thinking about what insurance is, at its core, why you are paying for this insurance coverage and how you expect your insurance coverage to react to a claim of yours.
Consider starting with a conversation with us, so that together, we can explore and learn about your commercial insurance operations and specific insurance coverage needs. We want to let you make your own informed decisions, no pressure, no stress.
Let us help you understand the commercial insurance buying process and together we will learn what’s right for you, the client. Contact us today via our online form, or give our office a call at Northern California (530) 681-1981 or Southern California (559) 930-9109 today!