There are several serious mistakes you could make when adding an insurance policy. However, all of them can be avoided.
While it is important to have insurance, it’s easy to rush into decisions that cost you more in the long run. Below are some common mistakes made by business owners when buying business insurance.
Basing Your Decision on Cost Alone
In general, it is a mistake to make every decision based on cost alone. Cost is not the only factor that should be considered. Rather, the factor of quality should balance it out. Choosing the cheapest policy you can find while not considering its quality might end up costing you more in the long term.
If your policy premiums are so cheap every month, they might not end up covering you when you need to file a claim.
The solution is to get a financial consultant to help you properly assess the value gained for the cost of the policy.
Not Reading The Policy
Another common problem is not taking time to peruse the policy itself thoroughly. Making big decisions about insurance without understanding the limits of the coverage, the deductibles, and what reimbursement policies might be in place is not a good idea.
A thorough reading of the policy is advised so that you can ask your insurance agent any questions before signing up. It’ll help you understand exactly what you’re covered for and what you’re not so you can be properly prepared.
Insuring Property But Not Insuring Income
It’s common for business owners to take out policies that protect their premises, their equipment, and their property. However, what many business owners fail to do is to insure their income losses as well during the time that the business is out of operation.
The income lost while rebuilding a business after a fire, for example, could be devastating. Therefore, you should ask your insurance broker about whether it might be a good idea to add business income insurance to your policy so that you can continue to survive should something go wrong.
Failing to Reevaluate Your Policy
Early on, you may have taken out a policy because you were in a rush and did not research or compare policies properly. You may have taken a policy out of necessity and are now paying a high price when it’s not strictly necessary.
Not reviewing your options properly when choosing a policy is a common mistake, which goes hand in hand with not regularly reviewing the policy you did choose.
If you’ve been paying top dollar for a policy, then perhaps it is time to find out if there is some way to get a reduction on your premiums or perhaps see if another insurer could give you a better quote.
Insurance is a competitive market and you will more than likely be able to find a better deal with a little bit of effort. What’s important is that you adjust your insurance policy as your business grows and as your risks shrink or expand in tandem.
As a qualified insurance broker offering quality insurance services, we at Prosperity QB can help you avoid all of the common pitfalls when choosing insurance for your business. Contact us now for a consultation!
