Most successful business owner's want to grow their company in order to make more money, hire more employees, increase square footage, etc. If they are able to accomplish that goal, shouldn't the business owner's insurance coverage grow too, to cover the size of the business?
Whether you’ve experienced an increase in revenue, hired more employees, or bought additional equipment, your policy should be adjusted accordingly. Take time every year to ensure that your current coverage meets your business’ needs. The Journal of Accountancy recommends considering the following topics when reviewing your current business income policy.
Know What’s Covered and What Isn’t
Knowing exactly what your insurance will and will not cover is an important part of the reevaluation process. For instance, most policies will provide coverage for losses sustained as a result of fire and theft, but not for flooding. It is better to understand and address the exclusions of your policy now than when you submit a claim.
Make Sure Your Equipment is Covered
If your business’ revenue depends at all on the successful operation of machinery, you’ll want to make sure that your policy provides coverage for damage to equipment. Now would also be a good time to review any lease agreements you may have, and make sure that you have at least the amount of coverage required by contract.
Be Prepared for a Power Outage
In this day and age, we often overlook just how many of our daily tasks rely solely on the assistance of electronic devices. If your revenue could be significantly affected by the loss of electronic transactions, make sure that your policy includes coverage for such circumstances.
If you do not currently have an internal response plan, now is a great time to make one. First, define your risks based on geographical, economical, and seasonal exposures. Then, develop a plan to address how your business would continue to operate should any of those catastrophes take place. Make sure your employees are familiar with the response plan and their role in its implementation.
While you plan to implement new aspects of your business, be mindful to review your current insurance policies and start considering what you’d like to change for next year. While no one ever wants to think about catastrophes, it’s important to ensure that your business would be fully protected if are ever faced with the aftermath. Review your Business Owner’s policy today, and then speak with your Preferred Mutual agent about your coverage, additional endorsements, and all the ways we can help protect your business.