8 Ways to Save Money on Business Insurance
A penny saved is a penny earned. So, there should no reason for you to not look at saving money while finalizing the insurance for your business. However, choosing the right insurance with the best prices is no less than walking a tight rope. The underlying idea for saving on business insurance should be to cut costs without compromising on the type and extent of coverage required for your business.
We have put together 8 the best ways for buying business insurance from the experts in the industry to save you money and time to have strong sanity.
1. Evaluate quotes from various carriers
There can be a slight variation in the weightage an insurance provider lays on different risk factors in a mix affecting a business. This could lead to substantially different quotes for similar coverage from 2 companies. Also, a regional provider is likely to charge lesser than a national player.
It only pays to invite quotes from different carriers and invest time to evaluate them to find the best price-coverage matrix that works for you. Paying due attention to the financial stability and reputation of the provider is equally important.
2. Pay annually instead of quarterly or monthly
Almost all insurance providers allow you to choose the option for premium payments – monthly, quarterly, half-yearly, or yearly. But the total premium you end up paying would be more if you do not choose the ‘yearly’ option – monthly being the most expensive one. You could save up to almost 15% if you pay the premium annually.
3. Choose a bundle of policies
Most carriers offer a package policy – Business Owner’s Policy – wherein common business insurance policies are bundled as one and charged slightly lower than the individual premiums put together. Fine read a BOP before you sign the dotted line to ensure that it covers the risks your business faces. At the same time check that you do not end up paying for a risk that your business doesn’t face.
Check with your carrier if you can choose a customized bundle instead of their standard one.
4. Go for a higher deductible
A deductible is an amount you pay before your insurance policy kicks in and starts paying you in case of a claim. In other words, a deductible is symbolic of the extent of risk you cover yourself. While there could be a minimum deductible, insurance providers allow you to set the deductible. A higher deductible translates to a reduced risk for the insurance company. This brings down the premium charged.
But setting an unreasonably high deductible would also mean having to shell out high amounts in an emergency (when the claim is to be made). Ensure that you can spare the amount set as deductible in case of an event.
5. Manage your risks
Putting in place a well thought or insurer-recommended risk management plan exhibits your keenness to keep the losses low in case of a disaster covered in the policy. This could include administering safety measures at the workplace, disaster management systems, or a theft-prevention plan. Implementing these improves your worthiness for an insurer as the risk they perceive in insuring your business is lowered. And therefore they offer further discounts on premiums. Check with your insurer if they have a tip sheet or a training manual for you to refer to.
6. Review your policy at the time of renewal
Your business could have undergone numerous changes within a year. When it is time for renewing your policy, take a relook at the types of insurance your business needs. For. E.g. if you have started hiring people, you might want to add workers’ compensation policy to your existing plan with some additional premium instead of buying it separately. Ensure that you take up this review exercise a couple of weeks before the renewal date to avoid the lapse.
7. No claims discount
A lot of carriers provide additional discounts if your business has been claims-free over a couple of years.
It is noteworthy that a high deductible is also advocated because it holds you back from filing smaller claims and makes you eligible for a no claims discount.
Make sure when you are evaluating different carriers you categorically ask if they offer such a discount.
8. Explore group discounts
Some insurance providers offer group discounts to business entities within the same industry. Check if yours provides too. You can avail of such offers by teaming up with other businesses and besides it could be a great way to network too.
Finding a great deal for your business insurance policy may not come easy. Study your options to be certain that you do not overpay but at the same time avoid getting a cheaper policy at the cost of coverage against risks. It is also recommended to work with a trustworthy insurance expert to make a well-informed decision faster and to keep the experience of buying insurance hassle-free.