When you’re purchasing insurance you want to get the best service possible, while keeping costs down. Yet affordable business insurance is only one part of the equation. Cheap business insurance also needs to be reliable to make it worth your while.
In other words, while cheap commercial insurance is a highly appealing prospect, there are other factors to consider, to be sure you're getting the best insurance for you.
How Insurance Prices Are Formed
Insurance payments and rates (and the different types of insurance required) can seem a bit confusing. But you don't need to be an expert to understand.
In fact, it’s not as complicated as you might think.
All insurance rates are determined by a formula. And each type of insurance has its own formula. So your rates will be a combination of the types of business insurance you’ll need, calculated according to the risks involved for each.
Pretty much all businesses will need general liability insurance and workers’ compensation. But other types of insurance will vary depending on your field. So for example, if you have a handyman business, and your employees drive around from job-to-job, you'll likely need to get them commercial auto insurance as well. If you’ve got a yoga business, you may want to consider health insurance, to keep employees covered, in what’s a very physical profession.
As for assessing your premiums, a couple of things you should consider include (but not limited to):
- The literal riskiness of your business – Obviously coal mining has more risk involved than say working as a house cleaner.
- Location – Often, if you’re working in a highly populated area, your business insurance payments will be higher. That's because more vandalism or crime take place in more frequented spaces.
- Size – More employees means, you guessed it, bigger payments (though you could leverage your size to get bulk discounts, if you’re big enough).
- Your popularity – Popularity will often increase your rates, as apparently more people make claims against well-known companies.
- Level of coverage – Generally speaking, the more you pay, the more extensive your coverage. This includes higher aggregate limits, as well as lower deductibles. Your premiums are a function of these matters. So if you want cheap business liability insurance, you can play around with these numbers, to find an equation that works for you.
More than Cheap Small Business Insurance
While you certainly want affordable small business insurance, you also need good, reliable coverage. That means your insurance provider should be:
- Available – They should work hours that are convenient for you.
- Accessible – Easily reached by phone, email, and web chat.
- Responsive – Listens to your needs, with live support where needed.
- Accommodating – Puts in effort to accommodate your requests.
- Reliable – Pays claims quickly, and according to what you’ve agreed.
So How Can You Avoid Overpaying and Keep Coverage Great?
Generally speaking, you end up overpaying for insurance when you:
- Take on insurance coverage that you do not need for your particular line of business, like property insurance if you teach yoga in a park, or auto insurance if you don't have a vehicle.
- Pay higher premiums and/or deductibles than necessary.
- And don’t read the fine print that many policies include. This is super important as it may limit claims, put a penalty on cancellation, or tie you in to a high rate, pretty much forever.
Finding the Right Business Insurance Provider
If you want affordable commercial insurance or cheap public liability insurance, you’re going to need to find the right provider.
Keep in mind, affordable is not the same as a bare bones establishment. Rather, it’s a commitment to keeping payments as low as possible, in tune with your business model and actual needs. Cost-effective services you should be on the lookout for include free copies of your Certificate of Insurance, and the ability to add as many Additional Insureds as you want. This may sound minor. But if you’re working lots of jobs, these payments (which can often be billed at $10+ per certificate) can add up.
Additionally, the insurance company you work with should value simplicity. All policies should be easily accessible, and easy to understand, with no fine print. If you need help, a human should always be around to help you out, quickly and clearly.
Since your business is individual to you, you definitely want your business insurance to be tailored to your needs. A handyman, a house cleaner and a yoga instructor all have different insurance requirements. And you only want to be paying for the coverage that’s relevant to you.
Bottom-line, highly reliable yet cheap liability insurance coverage is definitely attainable. It’s even something you should expect!