Most new business owners are cautious with their expenses—and rightly so. However, there’s one expense you don’t want to cheap out on: your commercial insurance. In this post, we’ll provide the critical information you need to choose a good commercial insurance plan. After reading this post, you’ll be one step closer to choosing a plan that provides the protection you need, so you can keep your business thriving even in the midst of a crisis.
To learn more about the different types of commercial insurance, check out this past blog post!
Do you legally need commercial insurance?
The answer to this question depends on your industry. There are some commercial insurance types that you need if you work in a higher risk industry, like workers’ compensation. However, in Alberta, general liability insurance is not required by law.
While you might not legally need most types of commercial insurance, that doesn’t mean you shouldn’t have coverage. Accidents and unplanned crises happen, and without the proper coverage, not having insurance can cost you your business. In fact, a recent study forecasts that 40% of all small businesses will file a claim in the next ten years.
Think about some of the potential problems your business could face. Here’s a quick list that goes over some risks:
- Your business location burns down
- A theft breaks into your business and steals valuable products or equipment
- One of your employees is injured on the job and requires expensive compensation
- A client sues your business
- A flood wreaks havoc on your office, ruining expensive equipment and shutting down operations for an extended period of time
These are just some of the things that can go wrong when running a business. And most of these occurrences are unforeseen acts that you have no control over. But they do have another thing in common: they are very expensive and can result in thousands of dollars worth of costs—all of which will come out of your pocket without the right coverage.
How to choose a good commercial plan
Not all commercial insurance plans are the same. Each type of commercial insurance provides a specific level of coverage for a specific type of incident. Here are a few things to consider when you choose a good commercial plan for your business:
01. What insurance coverage do you need?
Commercial insurance coverage isn’t universal. Your coverage will largely depend on your industry, your business’s assets, and the risks associated with the services or products you provide.
First, you’ll want to consider your business’s assets. What do you need to insure in order to keep your business running in the event of a crisis? This could include expensive equipment, vehicles, property, customer data, etc.
From there, you’ll want to determine what is legally required to cover. For instance, if you own a construction company, you’re legally required to provide workers’ compensation to protect your employees. You’ll also need commercial auto insurance to operate any company-owned vehicles.
Second, you’ll want to carefully consider the different risks your business may face. For instance, almost all businesses will want to include general liability insurance in their plan. This will protect you in the event a client or customer sues your business and will save you thousands of dollars in lawyer, court, and judgment fees.
In addition, you’ll also want to consider natural disasters that may affect the operations of your business. Including business interruption insurance and property insurance will help cover costs associated with damages, loss of profits, and more.
02. Use an insurance broker
Assessing your assets and risks can quickly become overwhelming. Consulting an insurance broker to help you navigate the different commercial insurance types and which ones are necessary for your business will ensure you have the coverage you need.
At Sadler, we work for you and not the insurance company. We’ll help you find a commercial insurance plan that best fits your industry and business. So you can always operate with confidence, knowing you’re covered in the event of an unexpected incident. Learn more about our commitment to you!
03. Ask questions about your premium and coverage
Don’t be afraid to ask questions when shopping around. Your insurance is the first line of defense against financial losses. Ensuring that you know exactly what aspects of your business are covered is incredibly important.
Not only will your insurance broker help you find the right coverage, but they’ll also help you read the fine print. So you’ll understand all aspects of your commercial insurance plan.
04. Look for a plan that can grow as your business grows
Hopefully, your business will grow over time. And you’ll want to ensure the commercial insurance plan you choose can grow with it. As you acquire more employees, equipment, properties, and more, you’ll need to increase your insurance coverage.
Choosing an insurance company that offers most (if not all) of the different commercial insurance types can help you maintain the coverage you need as your business grows.
How much does commercial insurance cost?
The cost of commercial insurance will differ based on a few key factors: your coverage, deductible, number of employees, and location. On average, the cost of general liability insurance falls around $65 per month. Most business owners will add property coverage to their plan (this bundle is normally referred to as a business owner policy). It typically costs around $100 per month.
One way to save costs, especially if you require different types of coverage, is to bundle. This is another reason why it’s beneficial to choose an insurance company that can provide all aspects of your coverage. When you bundle your plan with them, you’ll likely reduce costs.
Please note: these costs are averages only. The price of your commercial plan may vary depending on a wide range of factors.
Get the commercial insurance your business needs
If you’re looking to choose a good commercial insurance plan for your business, contact us! We’ll happily answer any questions you may have and find you a plan that fits your needs. So you can always feel confident while running your business!