Owning and operating a feed mill or farm supply store isn’t like running a typical Main Street business. You’re storing chemicals on-site, dangerous tools are hanging on the walls and in the isles, and you’ve got tons (literally) of inventory worth tens of thousands of dollars. This is your life’s work and your livelihood, it’s important that you protect it and your future.
So how can you protect your business and make sure you’ll be able to rebuild in the event of an incident? A key part of your plan should be a comprehensive insurance program that covers your business correctly at a price that won’t break the bank. What’s involved in this process? In the article that follows, we will discuss the key components of an insurance program, how you can manage costs and the best way to make sure you’re covered correctly.
What are the critical insurance coverages I should have?
Insurance coverage can get very specific and detailed. In this article, we’ll talk about broader insurance coverage types that are important for your business.
• Commercial Property – Property insurance covers your buildings and everything in it and just outside of it. Inside property includes office furniture and computers, stock in the store and on your shelves, phone systems and more. Outside items like inventory, fences and landscaping, signage are also covered. Property coverage will cover you from theft, fire and other unexpected events.
• General Liability – Liability coverage helps protect you from claims of negligence against you and your business by others. Liability insurance covers your business on simple slip and fall claims when a customer slips in your parking lot to a product claim when a farmer claims you delivered tainted custom-mix to his farm. Liability coverage will also help to cover administrative costs of claims and court costs like legal fees and judgments against you.
• Commercial Auto – Commercial auto insurance covers the liability and physical damage caused by company owned vehicles and the employees or owners driving them. It’s important to note that your general liability insurance does not cover you for liability claims relating to company vehicles.
• Workers Compensation – Workers’ compensation insurance is a federally mandated, state regulated insurance program that protects your business if an employee gets injured or becomes ill as a result of work-related activities. When your business is covered correctly, you’ll be protected against the overwhelming costs associated with a workplace accident or an employee lawsuit.
• Commercial Umbrella – Essentially, an umbrella policy is additional coverage. If you are found liable for damages beyond what your existing policies cover, an umbrella policy will help make up the difference.
• Cyber Coverage – Technology continues to play an increasing role in business and with that, cyber-attacks rise each year. It’s not just big companies that are vulnerable, hackers love to pray on smaller businesses that may not have sophisticated cybersecurity systems in place. These attacks – frequently in the form of ransom – can cost small businesses thousands of dollars. Cyber coverage can help defray the costs associated with a hack attack.
Each of these policies covers you against a certain set of risks. You don’t want to end up suing insurance company for denying claim. Within these, there are many specific coverages that can be tailored to your business. An independent agent can help guide you through which coverages you need and design a plan that’s right for you.
Managing the cost of insurance.
Insurance can be expensive, so how can you manage the cost of coverage? There are several ways to do this, which we’ll discuss below. Before you take any of these steps, it’s extremely important to understand how your choices will affect your coverage. We strongly recommend that you talk to an agent or broker you trust to develop a plan that you are comfortable with. Here are a few ways to manage costs:
• Deductibles – A deductible is the amount of money you pay toward a covered claim. Raising or lowering your deductible will directly affect your insurance premium. This will also affect how much you pay in the event of a claim – or even if you choose to file a claim – so you should carefully consider what you are comfortable with and what you can afford.
• Plan Design – Addition and removal of coverage features will also increase or decrease what you pay. Again, it’s important to understand how this will affect your coverage and that you develop a plan that you’re comfortable with.
• Safety Culture – Developing a culture of safety will, over time, reduce insurance costs through lower utilization and safer employees.
• Risk Mitigation – Spotting and dealing with hazards before they cause a problem is a great way to help lower costs. A full service agent should be able to help with this.
• Policy Review – When your business changes, so should your insurance coverage. Working with an agent that will review your current plan and make sure it still fits your needs is important. Additionally, a broker that can work with different insurance companies and will search to find the right coverage at the right price.
Taking these steps can help you reduce your costs. Speaking with an independent agent will ensure that you understand the effects of your policy choices on your coverage.
Make sure you are covered correctly.
Insurance is complicated, you’re an expert in your business, you shouldn’t have to be an insurance expert too. The best way to make sure you’re covered correctly at a fair price is to work with a broker or agent you can trust. Your agent will help guide you through the complicated world of insurance and design a plan that meets the unique needs of your business.
Your agent should provide you with quotes from multiple insurance companies, explain what each policy covers and why you need it and offer you additional services. In addition to providing you with coverage options and education, your agent should offer services like loss control and risk assessments, safety training, claims assistance, 24/7 customer call center and more.
If you’re just starting out or if you’ve been in business for a while, your operation could benefit from an insurance review and the experience of an independent agent.
This article is sponsored by Gannon Associates.
About Gannon Associates:
Gannon Associates is a full service independent insurance agent providing commercial insurance, personal insurance, benefits, and workers’ compensation coverage. With over 40 years of experience protecting our customers, Gannon’s has the knowledge and access to companies – like Travelers, Cincinnati, Selective, and over 80 others – to make sure you’re getting the right coverage at the right price
Eric Aeppli is a business insurance specialist for Gannon Associates Insurance. You can reach Eric by phone at 570-637-1334 or e-mail him at [email protected].
Stevens Lambert is a business insurance specialist for Gannon Associates Insurance. You can reach Stevens by phone at 570-404-3791 or e-mail him at [email protected].