According to the U.S. Small Business Administration (SBA), every business needs to have good commercial insurance to protect it from business risks such as lawsuits, accidents, natural disasters, theft, and vandalism. Without commercial insurance, your business is vulnerable to financial distress. For example, theft and burglary, which affect at least one out of five small businesses each year, will cost you an average of $8,000 without commercial insurance, as reported by the Insurance Journal.
With that in mind, the following are instances when you should review commercial insurance.
When Hiring New Employees or Buying New Equipment
A new addition to your business means that you have something extra that you need to protect. If you have bought a new machine or hired a new employee, you should sit down with a licensed insurance professional and review your general liability insurance to ensure that your commercial policy fully covers the new addition and that your business also adheres to all necessary legal requirements, such as workers’ compensation laws.
When Downsizing or Expanding Your Business
It is important to review commercial insurance if you are either downsizing or expanding your business. For example, if you are moving to a bigger or smaller office, there is a high chance that you will need an insurance policy to match the change. Similarly, when you have expanded your business, you should review your deductible and increase the coverage limit to maximize your insurance benefit.
When Your Business Acquires Another Business
When your business acquires another business, it is a good time for a review of your commercial insurance. This will give you the chance to make any necessary changes so that your policy meets your new needs. Moreover, it will give you an opportunity to bring both businesses under one policy, making it easier to manage your insurance policies.
Annual Commercial Insurance Review
Whether you’ve made some changes in the business or not, you should perform a commercial insurance review at least once every year to ensure you always have the right coverage for your business. It is also the perfect time to shop around for a better premium.
If You Have Made Some Improvements to Lower Your Risks
You may want to review your insurance if you have made some business changes that lower your business risks. For example, if you have installed non-slip mats in your business premises to help reduce slips, trips, and falls, which is responsible for several fatalities each year according to the U.S. Bureau of Labor Statistics (BLS), you should let your insurer know. Such changes can qualify you to have a lower insurance rate when renewing your commercial insurance policy.
These are five instances when you should review commercial insurance. If you need to review your commercial insurance, CF&P Insurance Brokers is happy to answer any questions you might have about your current liability coverage. For more information, call us at (925) 956-7700 today.