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As your business changes, so should your business insurance policy

Review claimLet’s be honest, when it comes to insurance, a lot of us buy a policy and don’t think much about it until the next renewal.

That philosophy might work in some instances, but when it comes to your business insurance, you’re doing yourself a disservice if you don’t review your policy on a regular basis.

It’s important to make sure the coverage you have is still what you need. Chances are, if you made changes to your business, your business insurance policy should reflect those changes.

Back to the basics

One of the first things to review on your business insurance policy are the general components, such as:

  • Are all the names under which you do business listed on the policy?
  • Is your type of business (LLC, corporation, sole proprietor, etc.) listed correctly on your policy?

Next, let’s look at your business property. Are all the locations of your business listed accurately? Did you build any new structures or greenhouses? Details are everything, and sometimes the obvious gets overlooked.

Policy review

Next, it’s time to take a critical look at your policy. If you’ve made changes to your business, some of the limits you currently have in place might not be sufficient. Some questions to ask yourself are:

  • Are the values listed for your buildings, equipment, and property accurate to reflect replacement cost in the event of a loss?
  • Is your Business Interruption insurance accurate?
  • Are the transit limits sufficient if you transport or ship property?
  • What is your comfort level with your current property deductible?
  • Do the crop values listed accurate reflect your current growing operation?
  • Are the mortgage companies and loss payees listed correctly?

General liability

Now that we’ve verified or made changes to some of the more general information, let’s look at some additional items you might not think about when reviewing your policy. For instance, are you comfortable with the limits for General Liability on your policy?

Here are more things to consider:

  • Are sales projections still accurate?
  • Do you provide professional services outside of your normal business operations?
  • Do you have any foreign products or foreign liability exposures?
  • Are the Additional Insureds listed on your policy correct?
  • Did you make changes to your product lineup or services rendered?

Workers’ compensation

As much as we hope our staff remains stable, it’s often in flux. And so are some of the elements that go along with employee turnover or additions. An evolving employee base could mean younger employees with less training. Or maybe turnover has led to low staff numbers for a period of time. All of this can lead to changes in your insurance policy.

When it comes to your staff and workers’ compensation, here are some things to review:

  • Do you want to make any changes to the Employers Liability limits on your policy?
  • Are your estimated payrolls accurate?
  • Do you hire subcontractors? If so, do you receive Certificates of Insurance from those subcontractors?

As your business staff changes, so should your insurance policy. You don’t want too little or too much coverage when it isn’t warranted.

Fleet vehicles and auto insurance

For those businesses that use fleet vehicles, auto insurance is a major component that must be kept current. Staff changes might mean more or less vehicles on the road for your company. Replacing fleet vehicles might lead to coverage updates. Here are some basics to keep in mind when it comes to business auto insurance:

  • Review the Liability limits and Physical Damages deductibles on the policy and adjust accordingly
  • Check that all vehicles are accurately listed on your policy
  • Verify that Additional Insureds and Loss Payees are correctly listed
  • Are any of the vehicles listed on your policy provided to an employee for regular use—does he or she take the vehicle home at night?

Review and ask questions

There are many different components to your business insurance policy, and it’s hard to keep track of everything. You want to consider items such as flood or earthquake insurance, as these events may not be covered in standard policies.

That’s why it’s important to review your policy with your insurance agent, and break down the policy into categories to make sure the proper time and attention is given to each.

Note the changes you have made to your business throughout the year, and make sure those changes are reflected in your policy. Keeping accurate coverage will save you a lot of time and money if something unfortunate were to happen. As a business owner, you know the importance of preparation. That prep work should include reviewing your business insurance policy, as well.