How to Cut Your Commercial Insurance Costs

If you’re a business owner, you know research, planning, and asking questions are all necessary for you to manage every aspect of your business-from employee schedules to general operating procedures to taxes.

Admittedly, you need to spend your scarce time and resources on activities that are key to your business. So other things necessarily slip.

But one thing that should be-and often isn’t-a top priority is your commercial insurance coverage. You pay high insurance premiums to protect your company from risks.

Why not take the necessary time to ensure that your coverage is working for you? And while you’re at it, look for ways to potentially reduce the cost of commercial insurance premiums.

Here are six ideas that may reduce your commercial insurance costs.

Create and maintain safety routines

Workers compensation insurance is one of the largest commercial insurance products a business has and needs. To keep these costs down-whether by discounts or through being claim-free-you need to be vigilant about eliminating safety hazards. Create a safety plan and maintain it. Involve your employees in the plan, such as by setting up a rotation to inspect business grounds or buildings. When you find something wrong, fix it immediately.

Beef up your training programs

Most insurers will offer sizeable discounts for companies that implement training programs for their workers. This benefits everyone.

Keep your insurance up to date

At least once a year, examine your insurance to ensure that all your needs are being met, but also to be sure you aren’t paying for coverage that is no longer needed. If, for example, you’ve recently outsourced work previously done internally, you may no longer need coverage. Or the coverage should change.

Classify employees properly

If you have employees, you can save by ensuring that your employees are classified correctly. Premiums for workers compensation and liability insurance rates are partially determined by employee classifications. For example, you may have sales representatives who are still classified as production line workers. Talk to your agent to ensure that your classifications are correct and up to date.

Install security features

It’s not as expensive as it used to be to install security, and there are a plethora of options now. Since insurers usually give instant discounts to businesses that have installed security features, you may find that you can pay for part or all of the cost of installing security with the discount.

Talk to your agent about reducing premiums

This may sound obvious, but many people don’t feel comfortable telling their agent they want a better rate and, even worse, they don’t ask if there’s something they can do to reduce premiums. Most agents are happy to help. By talking about it with you, your agent might become aware of some aspect of your business that could result in savings and may also suggest ways to reduce premiums that you hadn’t thought of before.

Make it a point to review your policy at least once annually, and to speak to your agent after the review. Remember: It never hurts to ask!

Four Key Questions For Your Commercial Insurance Agent

In business, as in life, it’s about knowing the right questions to ask. As a business owner, you may have concerns about your commercial insurance coverage. The following are four questions to ask your insurance agent about commercial insurance.

Why do I need it? You only have to think of the alternative. Even sole proprietors and independent contractors need commercial insurance coverage, as they are open to risk in any interaction they may have with individuals or other companies. No matter how small or large your company, your personal assets are at stake-which is why commercial insurance is so important.

What’s covered? Typically, you’ll have a commercial insurance “package” tailored to the needs of your business. It’s designed to protect you if your business is found legally liable for damage to another party. Coverages may include: Slander, libel, or misleading statements or advertising; property or physical damage; medical payment coverage; personal injuries that occurred on your business property or resulted from the use of your products; legal fees, including court fines/costs, settlements, and attorney fees; intellectual property claims or copyright infringement.

Who’s covered? This is dependent on your business type, and you can adjust it as your business grows. Typical policies will cover you, your corporation as an entity, co-owners and directors, and officers and shareholders.

Do I need specialized policies or policy addendums? Also dependent on business type, these may include: Workers compensation insurance, Product liability insurance, Key man insurance, commercial auto insurance, Cyber liability insurance.

5 Common Homeowners Insurance Claims

Virtually every homeowner is likely to experience a problem that will result in an insurance claim. However, it’s important to know what sorts of claims are common and what protection you need should you experience a problem. Following are the five most common homeowners’ insurance claims:

Water Damage: Even though you live far from riverbanks or the ocean, water damage is one of the most common-and most serious-claims. Burst pipes and overflowing toilets are just a couple of possible water sources. Ensure your policy covers water damage, whatever the source.

Severe Weather: Severe weather damage is expensive, especially in areas that are particularly prone to it. Coastal states experience hurricane winds and hail. States further inland face tornadoes, harsh winters, and uncommon occurrences like derechos (severe windstorms). Align your coverage with your area’s particular weather risk.

Accidents: Even best friends may sue if they are injured on a friend’s property. Carry high liability limits and an umbrella policy. That extends your policy’s liability limits if resulting injury claim expenses max out your policy limits-easily possible when combining your injured visitor’s lost wages, medical bills, attorney costs, and more.

Dog attacks: Fido may not hurt a fly, but for whatever reason, he decides to bite a houseguest. Your guest has every right to sue you. As with accident claims, you could end up owing a lot, especially when children are involved. Carry at least $300,000 in liability coverage.

Fire: Any fire loss is devastating, and the resulting claims process is taxing. You will need to prove that the property’s value is destroyed. But note: your insurer may not agree. To streamline claims and ensure adequate compensation, keep detailed personal property inventories like values, home upgrade information, correlating receipts, and appraisals. Carry sufficient coverage to replace your home and everything in it. And make sure to keep them safe in a fire safe lock box or online.

Moving in? Love Is Great, But Insurance Is a Necessity

When you embark on an exciting future with a life partner, insurance is probably the very last thing on your mind. But you should be aware that your new life will impact your insurance policies. Consider the following examples:

Homeowners and renters insurance

  • When renting a home together as an unmarried couple, be aware that neither the insurance industry nor the law considers your personal belongings jointly owned, and therefore you need separate renters’ policies. And for good reason. If, for example, you added together the value of each person’s property and purchased a policy covering the total amount in one person’s name, only the policyholder would receive compensation for the personal property claim. There’s nothing requiring the policyholder to share half, and no legal recourse if he or she doesn’t.
  • John’s a homeowner. Jane moves in. She’s not listed on the property deed, and therefore is not able to be covered under John’s homeowners insurance policy. In insurance terms, Jane is considered a tenant, and she will need renters insurance coverage for her belongings.

Auto Insurance: Domestic partners need separate policies. You can’t list both your vehicles on one policy. However, depending on the state and the insurer, each person must be listed on the other’s policy as one of the following: nondriver, excluded driver, or driver. Talk with your agent about different state and insurer requirements for auto insurance, and also about the impact of your change on other policies.

Would You Go Abroad for Medical Care? Many Do

Traveling abroad for cosmetic or other medical procedures is a growing phenomenon. Patients Beyond Borders (PBB) says that some of the top treatments sought abroad are weight-loss and cosmetic procedures, dentistry, last-resort cancer treatment, cardiovascular treatment, and orthopedic surgery. PBB also estimates that global medicine saves patients 20% to 90% of the cost of comparable U.S. treatments.

While comparable medical procedures may cost much less in other countries, they are not risk-free. Whether you travel to Mexico, Thailand, or Singapore for treatment, be sure to do your research before you go.

First, check with your health insurer regarding your international benefits and ensure that the cost of returning to the U.S. for treatment, if required, will be covered. Also consider the medical facility’s reputation and certification. The U.S. Joint Commission, which accredits U.S. healthcare organizations and programs, has now accredited more than 600 hospitals and clinics worldwide. Check for links to Joint Commission International-approved hospitals where standards of care may be higher.

Before you go, calculate the total cost of the trip, including airfare, hotels, cost of any attendants, and aftercare costs you might need while abroad.

The Joint Commission continues to approve additional international facilities, and medical tourism will continue to grow. But while you may feel like a pioneer, Americans living in other countries by choice or for work have long and successfully received medical treatment abroad. With careful preparation, so can you.

Riders Provide Added Protection You May Need

If you’re an average healthy adult, a standard health insurance plan will more than likely cover all your needs. However, problems can arise when your health changes. While many insurance plans are prepared to deal with some circumstances, chances are there will come a time when you may need extra protection. In this case, you may want to consider purchasing a health insurance rider.

For most people, this type of insurance amendment allows you to maintain your health insurance and receive adequate care while keeping prices lower. You will want to purchase riders according to your individual circumstances, but here are a few suggestions for those you may believe are worth the extra cost.

Indemnity rider: If your working conditions or hobbies put you in situations where you may be injured, this rider could be an extremely valuable add-on to your health insurance. If you lose a limb in an accident, this rider provides coverage during your recovery period. Depending on your policy, this coverage could also be doubled or tripled, depending on the injury.

Waiver of premium rider: When you’ve been lying in a hospital bed for weeks, the last thing you want to worry about is how you’re going to pay your health insurance premium. This rider allows you to waive your premium during extended hospitalization.

Major surgery rider: Most insurance plans come with procedure-specific limits and deductibles. This rider allows you to negotiate (to some extent) with your insurance company over which procedure limits can be raised or lowered.

These are only a few examples of riders offered by many insurance companies. If you need extra coverage of any kind, riders are a viable option, but some can be expensive; it’s best to weigh the pros and cons of altering your main plan versus purchasing riders. Your agent can help you assess which route is right for you.

The Easy Option Isn’t Always the Best One

It’s the eve of open enrollment, when you have to select which employer-sponsored benefits you want for the coming year. Should you go with the flow and accept your employer’s benefit plan, or should you take the time to talk to your insurance advisor?

Many of us wait until the very last minute and then choose not to choose. We select the easy option-the group life insurance offered by the company in the amount it sets.

And why not? As benefit options become more complex, it seems easier to pick the default.

But it’s for this very reason that you should consider consulting your insurance professional.

Tax considerations

Although your company may provide a certain level of life insurance for no cost, if the insurance is worth more than $50,000, it’s not really free. That’s because the Internal Revenue Service (IRS) considers any coverage in excess of $50,000 as part of your income, meaning it’s subject to Social Security and Medicare taxes. How do you know whether you are paying tax on your insurance? Just look at your pay stub. You’ll see a category called GTL, which stands for group term life. GTL is taxable income on your pay stub.

Job and health changes

On the other hand, a life-insurance policy that is not considered to be carried directly or indirectly by an employer has no tax consequences to the employee-a sufficiently compelling reason to look beyond your employer’s plan. But also consider what could happen if you change jobs and your health deteriorates; you may not be able to get outside insurance.

Compare your options

Now is the time to discuss your life insurance situation with your insurance professional. Ask him or her to help you compare the policy offered by your employer to exactly the same kind of policy you could purchase individually. The comparison may surprise you.