Renew your commercial insurance like a pro
Do you manage a business? Is your business growing and your needs are evolving? Your commercial insurance coverage should also evolve. If your coverage is up for renewal, here are a few useful tips to help you make sure your business is adequately covered.
Why should you reassess your insurance needs when you renew your policy?
If you're running a growing business, it means it's expanding. You probably have new customers or have expanded your product and service offering. Either way, you’ll probably need new equipment and increase your inventory.
So far, so good, eh? Yes, provided nothing goes wrong. For example, what if something were to happen to damage your machinery or building, and some of it was not covered under your commercial insurance policy, your business could take a hit. On top of the material loss, sales may be slowed or even interrupted.
To make sure your business runs smoothly, you should inform your broker if you buy new equipment, whether it be machinery, buildings or other items you need for your business.
When is it time to update your business insurance policy?
You should update your commercial insurance policy whenever your business activities change. Essentially, you should review the provisions of your policy as your business grows. Whenever your business undergoes major changes, you should notify your insurer, not just at the time of renewal.
Why notify your insurer? The insurance coverage amounts are based on the size of your company, its assets and the revenue it generates.
Many business owners will cite a lack of time or feel that their businesses are not at a great risk as reasons for neglecting to do so, but protecting themselves can prevent a loss from becoming a catastrophe for their business.
How do you reassess your needs?
Take stock of your company's business activities. Check whether you have added any new products or services to your service offering and whether your company has any new commercial assets. This can include furniture and even your online business, which may require special coverage.
The value of the buildings or assets you want to insure may have increased. Perhaps the value of your merchandise has increased? You could invest in new premises. Expand your employee vehicle fleet. Perhaps you might be hiring professionals in new sectors of activity? There are inherent risks to some professions that may require you to review the commercial insurance coverage you took out.
Which coverages should be updated?
Based on how your needs evolve, you’ll want to adjust some insurance coverages sooner than others.
If you’re renovating or making changes to your buildings, it’s a good idea to notify your insurer. The same goes for your business if you add furniture to the current location, upgrade your computer or telephone systems, or acquire valuable material, equipment or merchandise. In this case, the amount of insurance stated in your policy would need to be increased.
If your current inventory fluctuates throughout the year, because your business is either seasonal or it’s busier during certain periods such as the holidays, coverage is available to take peak periods into account.
Beyond your corporate assets, liability is another factor that changes as your business evolves. There are obviously risks associated with operating your business as it relates to your employees, the nature of your business activities and the geographic area in which you operate. The customers you rely on must also be taken into consideration. You may need to review your business insurance policy accordingly if more customers visit your facility.
Finally, a company that manages a fleet of vehicles will need to see how its fleet evolves over time. The number of vehicles is one thing, but that’s not all. Will employees be driving these outside the province or country? Will there be new drivers behind the wheel? Will the use of these vehicles change? Your insurance policy will need to include coverages that will change based on the answers to these questions.
Obviously, the best way to make sure you have the right commercial insurance policy is to contact your broker or insurer who’ll be able to help you determine precisely what you need.