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8 Business Insurance Shopping Mistakes and How to Avoid Them

In the United States, about 75% of businesses are underinsured. Whether you are a new business owner or an established company, it is important that you make sure you are properly protected in the event of a disaster or accident.

Still, it is important that you know how to choose the right type of policy for your business. Otherwise, you may end up with unnecessary insurance coverage or other mistakes.

Do you want to learn more about how to choose the right business insurance provider? Keep reading these top eight business insurance shopping mistakes and how you can avoid them.

1. Choosing the Cheapest Option

The biggest mistake that most companies make when buying business insurance is choosing the cheapest option. While it is important to find coverage that fits your budget, choosing an inexpensive policy can cost you more in the future if you have costly claims.

When you are looking at insurance prices, it is essential to also look at the value they are providing you with. Make sure they have enough coverage and that the pricing is not too good to be true.

Often, you can get free quotes or pricing estimates from a business insurance provider to help with comparing insurance costs to find the best-valued insurance.

2. Not Having Enough Coverage

Something else that you must avoid when you are getting insurance for your business is not having enough coverage. To save money, many business owners fail to get certain types of insurance coverage that they think they don’t need.

However, you never know what type of accident can occur which will affect your business, so it is best to have extra coverage.

First, make sure that you do not have too little liability insurance. If someone sues your company, a lack of sufficient coverage can cause serious financial damage to your company.

You also need to make sure you have enough workers’ compensation coverage to protect your employees from serious accidents and injuries. If you are worried about not having enough coverage, you can talk with your insurance provider to discuss your options.

3. Forgetting to Adjust Your Coverage Over Time

Getting insurance coverage is not a one-time process. Instead, you need to regularly evaluate your coverage and adjust it as your business changes and grows. Forgetting to adjust your coverage over time may cause your business to not have enough coverage when needed.

If you are planning to make any major changes to your business, you must meet with your insurance agent to see how you should adjust your insurance policy.

4. Not Insuring Potential Income Loss

Next, it is a huge mistake to forget to insure potential income losses. Offen, business owners think of all the physical assets that they may lose in a disaster. For example, if a hurricane hit your business, what belongings would be damaged by flooding?

However, it is also important to insure your potential income losses. If your business is seriously affected by a disaster, you may lose months of income while you make repairs. To avoid this, you must make sure you insure income loss to prevent this type of setback.

5. Not Comparing Policies

There are many policy options that you can choose from when you find the right insurance provider. You need to compare the available policies to make sure you are selecting the right packages.

One way you can do this is by getting quotes for similar insurance packages from several companies. If the packages have similar characteristics, you’ve done your due diligence.

6. Failing to Research Providers

While it is important to compare the different policies a provider offers, it is also essential that you research several providers before choosing one to work with. You need to learn more about a provider’s reputation to make sure you get the most value from your money.

First, you want to make sure it is a legitimate company. Sometimes insurance scammers will offer coverage that seems too good to be true to trick businesses into buying from them. Make sure the company seems established, has plenty of reviews, and is well known in your community.

7. Not Reading Through Your Policy

Another common mistake that people make when shopping for business insurance is failing to read their policies. While it’s difficult to understand all the legal jargon in your insurance policies, reading through the insurance terms and conditions is the only way to know exactly what is covered and what isn’t.

If you still aren’t understanding your policy after reading through it, your insurance agent can help simplify it and explain your coverage to you.

8. Sticking With One Insurance Provider

Finally, many people make the mistake of sticking with one insurance provider for too long. While this isn’t necessarily a bad thing, many times business owners will stick with an insurance agent that they know, even if they do not offer the best coverage options.

Sometimes, changing your insurance provider can help you save money and have better coverage. Make sure you consider whether you are getting the best value for your money, if your insurance agent offers all the services, and whether you could find better options somewhere else.

Need Help Avoiding These Business Insurance Shopping Mistakes?

When you are looking through your business insurance options, keeping these business insurance shopping mistakes in mind can help you find the best coverage for your business.

Do you want to learn more about choosing the right insurance for businesses? Oliver L.E. Soden Agency can help! Our team provides coverage options that match your business’ unique needs. Contact our insurance experts today to learn more about our coverage options and to get a free quote for your new insurance plan.