One of the primary reasons to go into business is to turn a profit. That doesn't necessarily mean making more money. You can also increase your company's profitability by cutting back on your expenses. One way to do just that is by finding ways to save money on commercial insurance.
Granted, you still need to make sure that you have adequate coverage for your business. The last thing that you want is to cut back on your insurance so much that you are left vulnerable if anything goes wrong.
The tips below will help you reduce the amount of money that you have to pay each month for commercial insurance without leaving your business overly exposed to risk.
1. Compare prices.
Every insurance company relies on different algorithms when calculating the cost of insurance policies. Because of that, you may qualify for a much lower rate with one company than with another. Comparing prices between different insurers can help you find a lower rate on insurance without sacrificing coverage in the process.
The majority of experts advise business owners to compare insurance rates once a year to see if they could save. Don't forget to take into account any loyalty discounts offered by your current insurer when deciding whether or not another company offers a better rate. You can compare with Money Expert.
2. Look into taking out a policy for business owners.
One way to streamline your insurance plan is by combining multiple insurance policies into one plan. For instance, by purchasing property insurance, liability insurance, and business interruption insurance from the same company, you may be able to get a discount.
If you decide to take out a business owner's policy, be sure to read the fine print carefully. Make sure that the policy provides all of the coverage that you need. For instance, many plans don't offer workers' compensation insurance, car insurance, or professional liability insurance.
3. Bundle your business policy with your personal insurance plans.
In some cases, you may be able to save money on commercial insurance by bundling it with other insurance plans that you already have such as your homeowner's insurance or auto insurance. Many insurers will provide a discount if you buy more than one policy from them. Check with your insurer to find out if they provide business coverage that you can take advantage of.
4. Don't buy more coverage than you need.
One of the biggest mistakes business owners make is purchasing a policy that provides far more coverage than they actually need. Read through the fine print of your plan to find out exactly what is and isn't covered. For instance, many commercial insurance plans include coverage for vehicles. If your business doesn't have a vehicle, you don't need this kind of coverage. Likewise, employment practices liability coverage is unnecessary if your business doesn't employ other people. It is a good idea to double check to make sure that you really need all of the coverage that you are paying for.
5. Choose a higher deductible.
Opting for a higher deductible may help you qualify for a lower rate. Of course, you need to make sure not to choose such a high deductible that you can't cover it if a problem arises. Ideally, you should choose the highest possible deductible that you can cover on your own without having to struggle to come up with the money to pay it.
6. Find out if you qualify for a discount for not filing claims.
If you haven't filed a claim with your insurance company for quite a while, you may qualify for a discount. That is one of the reasons why choosing a higher deductible is a good option. Since it keeps you from filing smaller claims, it may also help you qualify for this discount.
7. Find out if you can reduce the cost of insurance by implementing various programs at work.
You may be able to get a break on the price of your insurance simply by instituting some safety programs at work. For instance, insurers often provide discounts for plans that are designed to prevent theft, increase disaster preparedness, or improve safety in the workplace.
8. See if you can save with a group rate.
You may be able to save money on insurance by qualifying for a group rate. The easiest way to do this is usually by applying for insurance through a professional organization. Even though most organizations charge a membership fee, you can usually get it back through savings thanks to your lower insurance rate. Joining a professional group can benefit your business in other ways, as well, allowing you to network with people in related industries.
9. Pay your premium all at once.
Although most insurance companies will allow you to make payments on a monthly basis, you may be able to save money by paying your entire premium at once. Many insurance companies provide significant discounts for lump sum payments. If that doesn't work out for you, you still may be able to save by choosing to pay automatically each month by electronic funds transfer.
Putting some thought into purchasing commercial insurance can help you save a lot of money without having to give up any protection in the process. It is worth exploring all of your options to find an insurance plan that provides the coverage you need at a price you can afford.