When your business suffers an unexpected financial setback, the first place you look is where to cut expenses. If you haven’t had the need to use your business insurance policy, you may be tempted to let your business insurance policy lapse to save on the payments. Below, we’ll detail the reasons why this is a short- and long-term mistake.
No safety net. Without insurance, you totally and completely own any mistake and the liability that comes from it. There is no one to turn to in times of trouble and no way to get reimbursed for something that your business insurance policy would have easily covered.
Loss of discount. When you decide to restart your coverage, you may be surprised to find out you start from “zero” again and your long-term customer discount is gone. The clock may have restarted, and your original coverage might cost you much more without more benefits.
No long-tail coverage. Maintaining constant coverage with the same insurance company has its advantages, such as long-tail coverage. If you carry a liability policy that includes a standard completed operations portion, the work your company performs is typically covered for the entire duration of the policy.
Reputational harm. Uninsured businesses are often viewed as “fly by night” and not as trustworthy as insured businesses. Ask yourself: Would I want to do business with an uninsured merchant? There can be consequences much larger than just saving money at play for your business when you let coverage lapse.
Even if you find your business in a desperate financial situation, we’re here to help. Call us today so we can work with you on the right amount of coverage for your business and your pocketbook.