Many small business owners find it difficult to purchase business insurance on their own. Working with an insurance professional helps the business owner find insurance tailored to their business. But, how does the business owner find an insurance professional that knows the business.
Many businesses are categorized by insurance companies as high risk or too difficult to underwrite. Often, this is the case when a service business will be performing a service for low cost with a high potential for damage or injury. Businesses that will be serving the public, serving alcohol, working with expensive property or operating risky activities are some examples.
But, insurance is operated in a competitive market and there are always insurers willing to insure businesses of any nature. The trick is to find the insurers and their programs.
An insurance professional that specializes in your business is the best person to know and find this insurance. For example, we have a contact who specializes in insurance for salons and beauty parlors. But, how do you find such an agent or broker?
First, speak with other professionals in your business. It is best if you speak with local professionals (often competitors) and ask who they use as their insurance professional. You will often find that the same insurance professional’s name comes up repeatedly. Local agents often establish niche practices (like lawyers) and by speaking with others in your industry you will be able to find them.
Second, search out a professional organization that is representative of your industry. Such organizations exist for every conceivable industry. For example, the Professional Dog Walkers Association International is an organization of dog walkers and the Ohio State Bar Association is an organization for Ohio lawyers (where my professional liability insurance comes from). For a relatively low cost, you can join such a professional organization. These organizations often set up a network of insurance contacts for their members at a reduced price.
Third, if all else fails, join a local chamber of commerce or community organization and seek out one-to-one consultations with insurance professionals in the group. Most are happy to explore the market on behalf of a potential customer.
Finally, two points.
A broad Internet search is not a good way to find insurance for your business if it is not a commonly insured business. There are many, many reasons why you want to find and keep an insurance professional (local if possible) who knows your business in person. The do-it-yourself approach to finding insurance on the Internet should be used to find the agent and arrange a meeting – not to purchase the policy.
Premiums for some businesses are high. The best insurance professional in the world cannot overcome basic underwriting. If you are working with the public or can cause serious damage, then premiums will reflect that reality. Approach this with realistic expectations and after establishing a relationship with your insurance professional you can work on lowering premiums.
Critical illnesses are striking more Americans every year, and the financial consequences of surviving a critical illness are something few people are prepared for. The good news is, Critical Illness Insurance was created to provide cash at the time when it is needed the most.
According to a Harvard study in 2008, many families *with* health insurance found themselves under-insured and responsible for thousands of dollars in out-of-pocket costs.
Critical Illness Insurance is so important and can supplement your regular health insurance policies; everyone can benefit from Critical Illness Insurance. It can also supplement your Disability Insurance in many instances.
In fact, you can use the insurance to pay for the following:
- Medical treatments not covered by your health plan
- Your mortgage while you are recovering.
- Pay bills – from car payments to insurance premiums.
- Travel for treatments not available locally.
- Pay for experimental treatments (not covered).
- Replace a spouse’s income while caring for the insured.
Please contact us today and here at Let’s Insure we make sure you’re adequately covered for the unthinkable.
You could be overpaying or underprotected if you’re not regularly reviewing your policies.
As Salar Baktash, Owner of Let’s Insure observes: “The No. 1 reason people need to be reviewing their insurance policies is because their life circumstances change, and you do not want to be left either underinsured or paying for insurance you no longer need.”
To make the most of your check-up, here are some things to check for:
You may catch mistakes. You probably have a lot of insurance policies – health insurance, life insurance, auto insurance, homeowners insurance. There may be an error or two or three in one or more of those policies.
You might find a better rate. Insurance premiums can frequently change for several reasons, Salar says, citing homeowners insurance as a type you’d want to look at fairly often. You may have purchased your homeowners insurance policy after recent storms inflated rates, and perhaps yours haven’t come down but competitors’ rates have.
You gained more assets. Your life doesn’t just change. What you cover does. If you’ve been around a while, you have probably collected some stuff over the years, and perhaps a lot of it is expensive. For instance, maybe you locked in your home insurance rates when your new home was filled with secondhand furniture. If all of that has been replaced with sofas and a dining room table purchased from an actual furniture store, and that 20-inch TV was swapped for a 60-inch set, it may be time to discuss these upgrades with your homeowners insurance agent.
You can bundle your policies. If you have four different policies with four different carriers, you might want to bundle a few. That is, have your homeowners and car insurance with one company, for example. You can often get discounts of at least 10 percent when you start bundling, says Salar Baktash.
You may get some discounts. Yes, You may learn that you’re due for some discounts. For example, Homeowners can earn credits on premiums by installing safety devices like burglar alarms, water leak detection systems, battery backups for sump pumps and automatic standby generators. When combined, these credits can reduce homeowners’ premiums.
Spring is just around the bend, but that doesn’t mean you’re finished with rough weather. In fact, depending on where you live, snowmelt can create a new hazard — one that’s not covered by standard homeowners insurance. That makes March an ideal time to look into flood insurance.
Homeowners should understand that they are not covered for damage from flooding unless they have separate flood insurance. And only 5.5 million Americans had government-sponsored flood insurance in 2013, according to data from the Insurance Information Institute. Many homeowners elect to go without it, especially if they live outside established flood zones and their mortgage lender doesn’t require flood coverage. But even homes that are not considered especially vulnerable could be damaged, especially in years of unusual weather conditions.
“Don’t rely just on the maps to predict your flood vulnerability,” says Amy Bach, executive director of United Policyholders, a San Francisco-based advocacy organization for insurance buyers.
Water can be among the most destructive forces in nature. The average claim filed under the National Flood Insurance Program was nearly $42,000, based on figures from 2008 to 2012. Meanwhile, the average premium is around $650 annually.
Here are some things you should know or do before buying a policy:
You can buy a policy through the National Flood Insurance Program or through a private insurer. The NFIP has traditionally been a better value because of its subsidized rates, and it still is cheaper for most consumers, Bach says. But the coverage offered by public and private insurers is similar.
“We always say get two quotes,” Bach says.
Keep exclusions in mind
Flood insurance closes a major gap in traditional homeowners insurance, but it has exclusions of its own. The National Association of Insurance Commissioners warns that flood insurance typically does not cover the contents of a home, only the structure, and basements have only limited coverage.
A standard flood policy covers structural elements including drywall, circuit breaker boxes, furnaces and foundational walls, says Marjorie Young, senior vice president of E.G. Bowman Insurance in New York. Basement finishing materials are not covered. Homeowners can buy separate coverage for their personal property, but it requires an added premium.
Even if you buy a contents policy through the NFIP, you’re covered only for actual cash value, Bach says. That means you’ll be reimbursed for what a lost item was worth, not what it would cost to buy a new one.
Flood insurance may not be enough
Flooding isn’t the only reason you might have water in your home. Debris can also overwhelm sewer systems and cause them to back up. If flooding isn’t the technical cause, a separate sewer backup policy is the only way to be covered.
“Definitely add it if you can afford it,” Bach says. “These days, it feels like insurers, instead of looking for ways to pay, are looking for ways to deny. … Buying a sewage backup endorsement gives you an extra platform to argue for coverage if you have a water loss.”
Even if you buy the best coverage you can afford, for most consumers, floods present a financial risk. Unlike homeowners insurance policies, flood insurance policies don’t cover temporary relocation or anything outside your home, such as fences and patio furniture. But because floods are the nation’s most common natural disaster, it’s worth discussing coverage with a licensed agent.
Q: Home prices in my area have bounced around a lot over the past few years. How do I know if I still have the right amount of homeowners insurance?
A: The amount of homeowners insurance you need is based on the cost to rebuild your house, not the market value. Even if housing values in your area have gone down, the cost of building materials may have increased, which would boost the replacement cost of your home. You can use the building-cost database that insurers use to estimate the replacement cost of your home at AccuCoverage (you’ll pay $7.95 for the service). The site asks about the size of the house, the building materials and other details.
Or you can work with an agent or insurer to estimate the amount. Be specific about any upgrades to your house, including high-end materials you would like to be able to replace if the home were damaged.
Also be sure you’ve filled common gaps in coverage. For example, most homeowners insurance policies don’t automatically cover sewage backup, which can cause expensive damages if water or sewage backs up into your house. But you can generally get a rider that covers $10,000 to $20,000 in sewage backup damages for $50 to $75 per year.
Flooding is not covered by homeowners policies, but you can get coverage through the federal government’s National Flood Insurance Program. Go to FloodSmart.gov to look up your home’s risk of flooding and get price quotes.
Check the possessions coverage. Most homeowners policies limit coverage for possessions to no more than 75% of your dwelling coverage. For example, if you have a policy that provides $200,000 in coverage for your home, you’d have up to $150,000 in coverage for all of your possessions. But the policy may limit the coverage for certain categories of possessions, such as jewelry and antiques. If you have any valuable jewelry, artwork, antiques or other collectibles, you may want to buy special coverage to insure the items for their appraised value. This special coverage, called an endorsement or rider, also provides coverage for breakage, mysterious disappearance and theft from a location other than your home. Get the items reappraised every few years to make sure your coverage keeps up with their value.
And don’t skimp on liability coverage, which will protect your finances from lawsuits if, for example, someone gets hurt while visiting your home. It’s a good idea to have at least $300,000 to $500,000 in liability coverage, and you can buy an umbrella policy that adds an extra $1 million in coverage on top of both your home and auto insurance for about $200 to $400 per year.
To pay for the extra coverage, consider boosting your homeowners insurance deductible from $250 or $500 to $1,000 or more, which could reduce your premiums by up to 20% and prevent you from filing small claims that could lead to a rate increase or cost you a claims-free discount.
It strikes like a bolt from the blue: unwanted, unexpected, unwelcome. Unfortunately, many of us are totally unprepared for the financial hit that disability can bring.
Imagine: you’re suddenly unable to work. Without an income, you quickly exhaust your savings, undermining your family’s financial security. The money you’ve managed to put away for a vacation, the kids’ education, and your own retirement now has to be spent on gas, groceries, and other necessities. The worry is suffocating. The stress and sleepless nights can seem unbearable.
Worse, it could continue for a long time. Long-term disability lasts 31.2 months, on average, so the long-term financial impact can be devastating. Over half of all personal bankruptcies and mortgage foreclosures are a consequence of disability, according to a 2005 Harvard study.
Disability insurance can be an invaluable lifeline for disabled workers and their families.
- If your employer offers disability insurance make sure you fully understand what benefits are available to you and how your company’s disability insurance program works.
- If disability insurance is NOT provided by your employer, it can be purchased individually at affordable rates. Contact your insurance agent for more information.
- Self-employed individuals can also benefit greatly by having disability insurance. Consult your financial advisor or insurance agent for assistance.