Business insurance is the best way to protect your company from unexpected risks and the different things that can occur. There are a wide range of insurance policies that will cover different risks like crimes, liabilities and property damage. However you shouldn’t just purchase the insurance policies and then keep paying premiums without giving them a second glance. Once a year is a good amount of time to review the policies and make any necessary changes.
Here are some reasons why you should review your business insurance coverage on a yearly basis.
What You Should Review
The first thing you should be aware of is what types and part of your business insurance policies and coverage to review. Insurance policies like property insurance, general liability, business auto insurance and worker’s compensation are all good policies to review annually. If you have company health care, life and disability benefits or business interruption insurance, you want to review those as well. This includes the policy terms and what is covered, along with limits.
Why You Should Review Your Coverage Annually
The first reason it is a good idea is because many businesses start with the primary policies and get the bare minimum coverage in the beginning. You’re just starting out and aren’t yet sure what your risks are or will be. However, after your first year, a lot can change. The same can be said for each additional year. As your business grows and expands, your policies should expand with you. Another reason is you might have purchased new equipment for your business that needs to be covered. If you are using more vehicles for business purposes, you will want to review your commercial auto insurance policy and possibly add a higher limit to the coverage.
Tips on Business Insurance Coverage and Renewals
During the review process, keep these important tips in mind:
- If your business property lines have expanded or moved, you need to review your business property insurance coverage. If you purchased the policy when you were renting a single office in a large building, it only covered the office. However in the last year, you might have expanded and now have an entire floor. You need to have a larger property policy for the coverage.
- When your business grows and starts bringing in more revenue, your risks increase and you therefore need more insurance.
- If you have had changes in operation and the amount or type of inventory you have, you will also need to review and update your current business insurance policies.
Now that you know why it is important to review your business insurance coverage annually, you will be better prepared and offer your business more protection. Business insurance is essential and you should consider what new business risks you might have that might warrant a new insurance policy.