As a business owner, you need to ensure that you have the best possible insurance package that covers all the risks and needs of your business. However….
As a business owner, you need to ensure that you have the best possible insurance package that covers all the risks and needs of your business. However, there is also an increasing need for businesses to save money wherever possible.
To help you make sure you are getting the best value for money out of your insurance without putting your business at risk, we have compiled some tips to help navigate business insurance without breaking the bank.
These tips are general advice only and don’t take into consideration the specific needs of your business. Before going ahead with this advice, it may be a good idea to speak with your insurance broker first to ensure it suits your business requirements.
Use an Insurance Broker
An insurance broker is a professional who has the knowledge to navigate the complex nature of business insurance and find the most appropriate package for your needs and budget.
Other forms of insurance, such as home and car, can be relatively straight forward, and individuals may opt to take out policies directly with the insurance company. However, business insurance is more complex and an insurance broker can analyse your business needs and use their knowledge to negotiate the best insurance package for your business.
Choose the Best Options
A good money saving tip is to familiarise yourself with the policy options on your business insurance.
Many policies have numerous options that you or your insurance broker can review to ensure you have not selected additional options that are costing you money but are not applicable to your business.
Conversely, you may not have selected options that would be appropriate for your business. These additional options may cost more money initially but will mean that you are covered in the event of a significant claim.
Check Your Level of Cover
This involves checking the monetary value of the cover you have on each area of business insurance and making sure you have the right level of cover.
For example, you may have increased the amount of cover on your public liability insurance for a specific project but haven’t reduced the level even though that project is complete. Or perhaps you have sold an expensive piece of equipment and can reduce the level of insurance you have for your remaining equipment.
Remember, it’s never a good idea to reduce your level of cover just to save money and you should only reduce your level of cover if it’s genuinely too high.
Pay Your Insurance Annually
Many businesses opt to pay their insurance on a monthly basis to spread the payments throughout the year. However, most insurance companies charge more for this monthly payment option due to this payment form being structured through premium funding, which is a form of financing for insurance premiums.
With this premium funding contract, you will often be required to pay interest of up to 15% on your insurance premium. For this reason, it is almost always cheaper to pay your insurance bill annually.
Review Your Business Activities
If your business activities have changed, this can have a significant impact on your insurance levels.
Don’t forget to let your insurance company or broker know if there have been any changes as this could save you hundreds, or even thousands, of dollars. An example would be a trades person who has stopped working on a mine site and is now doing domestic work only. This alone could reduce the cost of an individual’s business insurance by a third.
Review Your Business Size
The size of your business can significantly impact on the cost of your business insurance, especially in the case of public liability insurance or professional indemnity insurance.
Both the number of staff you have and the amount of revenue your business makes can impact the cost of your business insurance. If you have reduced your staff numbers or your revenue has fallen, be sure to let your insurance company or broker know.
Another thing to remember is that some insurance companies base their premiums on your staff numbers while others base them on your revenue. Therefore, if you have low staff numbers but high revenue, it would be worthwhile to have your business insurance with a company who base premiums on staff numbers.
Shop Around
Before you make any decision on business insurance, it would be worth your while comparing a number of different companies and packages to make sure you have the most appropriate package for your needs. Each insurance company has their own pricing structure and these can differ significantly.
To make this process easier for you, an insurance broker can compare various insurance companies and policies for you to find the best fit for you and your business. Your broker’s knowledge means they can easily understand the complexity of business insurance and can see differences in packages that may seem otherwise identical.
Given the importance of finding the right business insurance, it is also a good idea to shop around to find the best insurance broker for the job!
Request a Discount
It never hurts to request a discount when you are taking out business insurance.
Insurance is a competitive area and many companies will agree to discount in exchange for your business. This is particularly the case when you are taking out a number of policies with the same company.
Saving money doesn’t mean you have less insurance protection and the tips above can assist in your business getting better value out of its insurance package.
Please don’t hesitate to contact the friendly staff at Elliott Insurance Services for further information about business insurance and we will be happy to assist in any way.
