Many small business owners may think they can get by without an insurance policy. However, this misconception may cost you more than your yearly premium payments in the long run. Small businesses need a comprehensive insurance policy just as much as larger businesses. If you’ve tried to look, you likely understand the challenge of finding the right policy—a process that can be time-consuming and frustrating.
You need a solution that caters to your unique business requirements, but you only have so much time to look for the right policy. So, how can you make sure you get the best coverage with the resources you have?
This guide will simplify the small business insurance comparison process. Let’s discuss important considerations, common mistakes, and current insurance trends so you can confidently find the right plan.
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A good insurance policy will balance both coverage and cost-effectiveness. However, it isn’t always easy to find this balance due to everything that’s factored into an insurance policy.
Here are some of the key insurance policy components to consider when making a small business insurance comparison.
Every insurance policy will have exclusions and a monetary coverage limit. A general liability policy will cover someone else’s damaged property if your business operations cause it. However, general liability will not cover personal property damage or damage to your business property.
It is crucial to remember that every insurance policy has exclusions you may not expect. When doing a small business insurance comparison, ask potential insurance providers about what their policies do and don’t cover.
Here’s a perfect example: if you run a lawn care business, runoff from pesticides is only covered under a specific type of policy called a pollution liability policy or environmental insurance. However, if you don’t discuss this scenario with an insurance provider, you may make the costly mistake of assuming it’s covered under a more common policy.
When looking for insurance policies, discuss your necessary coverage with an insurance expert. Don’t limit your coverage needs just because you’re a small business — get the coverage that will protect you.
The premium for small business insurance is typically paid when you buy your insurance plan, with periodic payments keeping your policy active. Many insurers also offer payment plans that allow you to pay month-to-month.
The cost of your premium will depend mainly on the coverage limits of your insurance policy, claims history, and the location of your business.
Your plan's deductible is how much you’ll pay out of pocket before your insurance policy steps in. Some plans have deductible options as low as $0, but this option usually increases your insurance premium.
When doing a small business insurance comparison, don’t just compare prices. Compare the providers' customer experience. You can also look for customer reviews for every insurance provider you consider.
An expert insurance provider should provide an enjoyable customer service experience and be transparent about what you need. However, not all insurance providers will be as transparent. As a result, you may not find the best policy for your business without taking proactive measures.
How can you ensure you get a policy that provides the coverage you need? Avoiding these three common mistakes can help.
If the first provider you see provides you with a reasonable-sounding quote, you may not consider that there’s a better option out there. You won’t know your options until you talk to several insurance providers.
You may miss out on lower premiums, deductibles, and more comprehensive coverage if you don't do a small business insurance comparison between several insurance providers. If you don’t have time to talk to different providers, you can use an online platform to compare coverage options quickly.
Many insurance providers don’t know your business in detail and may not ask specific questions. As a result, they recommend coverage based on a broad understanding of your business. You may buy that coverage only to find out later that the coverage you needed was excluded.
Small business owners may wonder why such comprehensive insurance is necessary, especially if they don’t own much equipment or property. They may think that only large corporations are taken to court.
While small businesses may not often feature in high-profile litigation, you need coverage. Buy insurance that can cover the worst-case scenario, not the most likely or best-case scenario.
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Small business insurance isn’t exempt from rising prices. Weather is becoming more unpredictable, workers' compensation claims continue to increase, and the cost of treating injuries is rising. These are just a few factors contributing to the predicted single-digit increase in insurance prices in 2024.
Supply chain disruptions resulting in product shortages and the COVID-19 pandemic can also be cited as causes of increased prices. Specifically, the COVID-19 pandemic increased demand for business interruption insurance that didn’t exclude viruses, resulting in higher premiums for insurance holders post-pandemic.
Another trend small businesses should be aware of is the demand for cyber insurance. Most businesses use technology daily. Storing sensitive data, including healthcare, payment, or personal information about employees or customers, puts you at an increased risk of a costly cyberattack.
Cyber insurance is usually sold as a separate policy, which you can find with the help of insurance experts like those at CoverHound.
When you pick out an insurance policy, remember to look for these key parts: premium and deductible costs, coverage inclusions and limits, and customer service experience. Investigating these parts of your insurance policy before you buy can help prevent unexpected costs down the road.
Getting multiple quotes, working with an insurance expert who knows your business well, and buying coverage for every scenario can also be helpful.
CoverHound offers small business owners an all-in-one online platform where they can quickly compare different insurance plans. Our platform allows you to manage policies in one place and pick bundled policies tailored to your needs.
Get your custom insurance quote today in less than five minutes!
Insurance shopping simplified
Insurance shopping simplified
