When to review your business insurance

Posted in Business

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Because commercial insurance is customized to the unique needs of each business, many business owners have a “set it and forget it” mindset about their policies. And that’s totally fine – especially if your business doesn’t experience big changes year-to-year. However, there are a few situations that, when they happen, can impact your insurance costs and coverage.

Here are some of the scenarios when you should consider contacting your insurance agent and reviewing your business insurance:

1. Your business significantly grew or shrank.
Swings in your business – up and down – can impact your insurance needs and costs.

For example, if your business greatly increased or decreased its revenue from the original estimate you provided to your insurance company, you could owe extra money to your insurance provider or have been eligible for a lower insurance premium.

You aren’t required to contact your insurance provider when your business fluctuates, but if you do, your insurance agent can help you stay on top of how much insurance your business should have and how much you should be paying.

In the case of a large increase in revenue, you’ll owe back money for the entire time that your business exceeded your original revenue estimate. You don’t want to be caught off guard in this situation! And if your revenue greatly decreased, you could have been paying more for your business insurance than you needed to during that time.

It’s a similar situation for gaining or losing a significant number of employees, especially if you have workers’ compensation coverage, or if your subcontractor costs have significantly changed.

Whether your business is taking off or slowing down, be sure to keep your insurance agent in the loop and it will help you pay the right amount for the right amount of insurance coverage for your business.

2. Your locations, products or services changed.
When you open, close or relocate, it will influence your insurance needs. Always notify your insurance agent when big changes happen among your business locations. Be sure that you have all the right locations listed on your policy.

It also may be smart to contact your insurance agent if you choose to sell a new product or service that is quite different from the products or services you’ve been selling. Your business insurance coverage will need to reflect this change, in case a new product or service exposes your company to new risks.

Even better, consult with your independent insurance agent and underwriter before you choose to add on a new product or service and learn how it could affect your insurance coverage.

3. You added vehicles, upgraded equipment or renovated the office.
When you make exciting new updates to your business, you might also be exposing your business to new risks and potential losses. It might cost more to replace a newly renovated office space or high-tech equipment that you purchased to take your business to the next level.

You also need to disclose if any vehicles are being used for business activities and make sure they’re covered by a commercial auto insurance policy. And if you adapt a commercial vehicle, for example by adding on a fifth wheel modification to the business’s truck, it could become a different “class of vehicle” and need to be updated in your commercial auto insurance policy.

4. You made improvements to lessen your risks.
Take advantage of your insurance company’s Risk Management Consulting or Loss Control services to identify the unique risks inside your business before they become an issue and receive advice on how to avoid accidents and losses. For example, your risk management consultant might find a slip, trip and fall hazard inside your warehouse and encourage you to install non-slip mats in that area. When you make their recommended improvements, let your insurance agent know. In some cases, making improvements could qualify you for a lower insurance rate at renewal.

Do you need to review your business insurance? Talk to your independent insurance agent and make sure your business has the right amount of insurance coverage at the right cost.

Grange Insurance commercial policyholders also have access to our Premium Audit, which is completed annually for Workers’ Compensation policies and less frequently for General Liability policies. With Premium Audit, our auditors use an easy checklist to determine if you’re adequately insured and help you make adjustments if you aren’t.

This article is for informational and suggestion purposes only. If the policy coverage descriptions in this article conflict with the language in the policy, the language in the policy applies. For full details on Grange’s commercial insurance, coverages and discounts, including our 36-month commercial package policy option, Risk Management Consulting and Premium Audit, contact your local independent agent.


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