It’s that time of year again. It’s time for you to renew your business insurance. Sure, you could just rubber stamp the invoice and pay for the same coverage from the year before. However, that is almost never a good idea. Insurance is there to protect your business, and if you don’t take the time to properly go over your insurance at renewal time, you could leave yourself unprotected. Conversely, you might be over-covered, which means you are paying more than you need. Here’s a handy checklist so that you know what to do when your business insurance is up for renewal.
Take a Look At Your Inventory
Do you have inventory on your property? If so, has your inventory level changed over the past insurance cycle? If so, you may need more insurance to properly keep you protected. Many businesses will undergo changes in their shipping and receiving, meaning that more inventory is on site and at risk of damage or theft. Check how much your old insurance policy covered for inventory losses, and see how it compares to your newest offer. If it is not high enough, then make sure to purchase more coverage.
Have You Made Any Changes to Your Business?
If you’ve made changes to your business processes, then you might need to re-evaluate your insurance when your renewal comes. For example, if you’ve implemented delivery or additional shipping options, you could have more risk than before. Your vehicles are more likely to get into accidents if they are on the road delivering more, for instance. There could be other changes, such as allowing more people into your place of work, which could lead to more potential for liability. To protect your business properly, you should be regularly evaluating your risks and ensuring you have the right coverage for them.
Have You Introduced New Products?
Introducing new products is exciting! There’s nothing better than producing something that many people buy and enjoy. However, when you introduce new products, you might be introducing new risks as well. For instance your product could be made with toxic materials, or it could have sharp edges that can injure someone. No matter what, you should have a safety analysis done on any new products, but it’s always a good idea to have product liability insurance just in case something bad happens.
Has Your Building Changed?
Your building may have changed at some point during the previous billing cycle. Have you added any additions, or fixtures to your building? More building space would mean higher premiums, since your building would be worth more. If you installed a fence, or other security measures, then you might be in line for a discount since you are actively preventing theft. If you have a renovation it may also affect your premium, depending on what you have done. Always notify your provider when you make changes to your building and the exterior.
Have You Purchased More Equipment?
Equipment can carry a lot of risk. Heavy machinery or even small ovens have more potential to cause injury or damage. IF you’ve purchased a new piece of equipment of some kind, you may need to increase your coverage to be able to properly protect. A cooking appliance can create a bigger fire risk, and machinery could cause injury or worse.
Do You Have Security Systems Installed?
If you’ve taken steps to be more secure in the previous year, then you might be up for a discount. The more secure your building is, the less likely you will be the victim of theft. Plus, even if you are, the cameras offer you an opportunity to identify and capture the culprit and get your goods back. Security equipment can include fencing, keypad doors, biometric entrances, CCTV cameras, and clearance-level access to certain parts of the building.
Have Your Staffing Levels Changed?
The more staff you have, the more risk you have that something will go wrong. Plus, the more staff you have, the more you will have to pay for workers’ compensation and other labor related coverages. In fact, in some states it’s mandatory to offer certain health benefits as soon as you have over 35 employees. If you have more staff, then you need to update your insurance provider. Your employees are your most important asset, so you should treat them as such.
Did You Move?
When you move addresses, there is almost no doubt that your insurance will need to change in some way. Even if you have a new building with the exact same layout as your old, you still have to account for the neighborhood. If your new location is in a space that is near a rough part of town, or near a large body of water that might flood, then your premiums will most likely go up. Always take this into consideration when you are decking to move your business to another location.
Has Your Business Revenue Changed?
Business insurance is often based on the valuation of the business. If you have been raking in the revenue over the past year, then your business is most likely worth more than it was before. Therefore, you have more to lose, and more to protect. Discuss this with your insurance provider to come up with an appropriate coverage level.
How Do You Want to Pay?
There are several ways that you can choose to pay for your insurance policy. You can pay one large sum at the beginning of the billing cycle, and not have to worry about it again until next year. Or, if it’s too much for you to pay all at once, you can pay every month. You can also choose whether you want a high deductible, which will lower your payments, or a low one, which will do the opposite. Renewal is a time when you can make your payments work for you.
When your business insurance comes up for renewal, it’s not a time to simply write a cheque and forget about it. Make sure that you go over this checklist to get an accurate assessment of what you need for insurance.