6 common mistakes when purchasing small business insurance.
Reading the terms and conditions
Reading through the terms and conditions is something that most people don’t want to do as it can sometimes seem long winded. However, it is important to make sure that the insurance you are purchasing is what you need. Make sure to read through the entire terms and conditions section to know what you are required to do in order comply as a policyholder.
Purchasing policies purely on price
Every business aims to cut down expenses and maximize profits, most people find cheap insurance policies very enticing and risky. As much as price is a concern, it is vital that you research on the efficiency of the insurance company first. For instance, check their security rating, how effective their claim service is, and how prompt they are in reimbursing. Checking through online reviews can be a good starting point in your research. If something appears to be too good to be true it usually is!
Incorrect business description
This problem mainly occurs with online insurance quotes because most businesses fail to capture the exact value of what they want to insure. It’s good to ensure that your description captures all the business property and activities as required by the insurance company. Omitting essential information can lead to under insurance, which can bring some misunderstanding when demanding compensation. A simple rule when it comes to insurance – if it’s not written down it’s not covered.
Not purchasing business interruption insurance policy
Small businesses can suffer great losses in the event of an accident, especially if it takes longer to go back to the normal operations. This greatly affects start-ups that are struggling to break even. Even though the insurance can replace the lost property through a normal policy, the time lost is significant to the venture. Including business interruption under your policy will cover the revenue lost when the business is closed for repairs due to an insured loss such as a fire.
Paying for policies that the business can do without
Some Insurance companies and brokers are determined to talk you into insuring everything, sometimes things that are not necessary. You need a genuine insurance broker who will advise you on what is necessary for your business. Seek the assistance of reliable brokers such as Clarke Williams to know what is worth insuring, sometimes a more practical solution may be available.
Not reviewing your business insurance
A regular review of your business insurance helps you to make the right adjustments as your business grows. For instance, if you have moved your business to a new location or acquired some new assets, it’s essential to capture all the changes. Meet with your insurance broker on an annual basis to review all the changes.
If you would like a member of staff to review your business insurance please call 01732 378 909 or email info@clarkewilliams.co.uk
