Insurance: Don’t Eliminate Coverage to Save Money

Blog content provided by Barbara Weltman, Publisher of Big Ideas for Small Business ®

As business owners look to trim their budgets, insurance (protection that’s only needed if something happens) can easily seem like a great place to cut. Don’t!

Without adequate insurance, any casualty or other catastrophic event could wipe you out and shut you down.

Be sure to maintain the following types of coverage:

1. Property and liability coverage, commonly within a single business owner’s policy (BOP);
2. Workers’ compensation and unemployment insurance for staff—the law requires it;
3. Vehicle coverage—the law requires insurance for cars and trucks on the road;
4. Special coverage for home-based businesses—don’t assume your homeowner’s policy will cover losses to inventory and business equipment in your home; get a separate BOP if necessary.

Areas to trim …

You can reduce the cost of insurance by:

~ Shopping around for the best deals—compare rates from several companies for similar coverage;

~ Increasing your deductibles to reduce the premiums—view insurance as something for catastrophe and pay out of pocket for the little mishaps;

~ Trimming health coverage if you’re providing it (or shift more of the cost to employees if necessary).

Insure U for Small Business, a website from the National Association of Insurance Commissioners, provides information and tips to small companies and home-based businesses. For example, Insure U advises that you review your insurance coverage annually to make sure it meets your needs and suits your pocketbook.

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