12 WESTERN PALLET
Risk Insights
End-of-Year Steps for Small Businesses to Review Their Insurance
with Brint Walker
As the year wraps up, it’s a great time for small business owners to think about what went well and what needs work. One important task is to check your commercial insurance plans.
Making sure your insurance is up to date can help keep your business safe from risks and make sure you have the right coverage for the year ahead. Here’s an easy guide to reviewing your insurance before the New Year.
1. Check for Changes in Your Business
A lot can change in a year. Maybe you started offering new services, hired more employees, reduced your number of employees, or bought new tools and equipment. These changes can affect the amount and type of insurance you need.
Start by writing down all the changes your business has gone through this year, like new products, added locations, new equipment, or new hires. This will help you figure out if your current insurance still protects everything you need it to.
2. Review Your Insurance Policies
Once you know what’s new, take a closer look at your current insurance coverage. Small businesses often have a mix of different policies, like general liability, property insurance, workers’ compensation, and employee benefits. Here’s what to focus on:
Coverage Limits: Make sure your coverage is enough for your current needs. If you have more employees or more expensive equipment now, you might need to increase the amount of coverage.
Policy Exclusions: Pay attention to what your insurance doesn’t cover. For example, a standard business policy might not protect you from cyber attacks.
Policy Expiration Dates: Know when each policy ends. If different policies end at different times, it might be simpler to combine them with one insurance provider. This can make things easier and sometimes cheaper.
Open enrollment: Find out when your enrollment period is to make sure you can let your employees know when they can enroll in or change their coverage.
3. Look at Past Claims
Think about any insurance claims you made during the year. If you had a lot of claims, it might mean you need more coverage or need
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to improve safety practices to lower risks. Having many claims can also raise your costs when renewing your policy.
If you didn’t have many claims, that’s good news. It may help you get lower rates when talking to your insurance company. Be ready to show how you’ve been keeping risks low.
4. Consider Adding or Changing Coverage
As you review your insurance, you may find that you need new types of coverage. For example, if your business has increased use of the internet for invoicing, order submission, or online sales, it might be a good idea to add cyber insurance to protect against data breaches. If you’ve hired new staff, double-check that your workers’ compensation policy is up to date.
5. Compare Prices from Different Companies
Insurance prices and coverage can change from year to year. It’s a good idea to get quotes from different insurance companies to see if you can get a better deal or better coverage elsewhere. When comparing, make sure you provide accurate information about your business so you can make fair comparisons.
6. Talk to Your Insurance Broker
Your insurance broker is there to help you. They can explain your options, suggest any changes you need, and find the best coverage for your business needs. Brokers can also give you access to special options that you might not know about.
7. Budget for Insurance Costs
Insurance premiums are an important part of your budget. Plan ahead for any expected changes in costs so you’re not surprised. If your review shows you need more coverage, make room in your budget for it.
8. Get Ready for Renewals
When it’s time to renew your policies, make sure your insurance broker has all the right details about your business. This includes any changes to your revenue, equipment, or services. This will help prevent any issues if you need to make a claim.
9. Improve Risk Management
The end of the year is a good time to look at your safety practices. Training employees, improving cybersecurity, and doing regular maintenance on equipment can reduce your risks and might lower your insurance costs too.
Final Thoughts
Reviewing your business insurance at the end of the year is an important step to keep your business safe and ready for the future. By checking your risks, coverage, and potential new options, you can go into the New Year with confidence. With a little planning and help from your insurance broker, you can make sure you have the right coverage at a good price for your growing business.
Brint Walker, CLU, ChFC
805-427-5720
Acrisure Insurance
Brint Walker,
Contributing
Writer
November 2024