As your business becomes more successful, the risks of operating without proper insurance increase. Buying business insurance? Make the right choice for your company with these three tips:
1. Do Your Homework
The self-employed need to have their own back. Whether you’re a solopreneur with a web-based business, an independent contractor, or a freelance artist, you need to protect yourself and your assets. And as your business becomes more successful, the risks of doing business without proper insurance increase exponentially. In the end, you’re the boss and the buck stops with you. If you don’t protect yourself, who will?
Any event that results in a loss of income—natural disasters, acts of vandalism, illness, or frivolous lawsuits—could potentially sink your business. The best way to protect your business is with comprehensive insurance, but can you afford it?
Feeling overwhelmed by the variety of plans and packages available? Contact our agency.
We will begin by researching the insurance packages commonly carried by professionals in your industry. Depending on the nature of your business, you might need one or several of the following: general liability, commercial property insurance, professional liability, product liability, business interruption and worker’s compensation.
2. Know Your Risks
When you apply for a policy, your insurance company will measure the information contained in your application against a model of “acceptable risk” generated by an underwriter. In order to clear a profit, insurers need to do everything in their power to avoid clients whose behavior, occupation, or professional record suggests excessive risk.
An underwriter will assess your application to determine the rates and terms of your policy. Every underwritten policy carries a premium as well as a deductible. A premium is essentially the fee you pay in order to remain insured, and premiums vary widely from provider to provider.
A deductible is the amount of money you agree to pay every time you make a claim. Generally speaking, your deductible and your premium have an inverse relationship: If you agree to carry a higher deductible, then your premium payments will be significantly lower. But tread carefully: A low-premium, high-deductible policy seems like a bargain until it’s time to make a claim.
3. Let Us Shop Around for You
Insurance is the single greatest expense for many independent contractors. The cost of insurance varies for every business, but some providers specialize in insuring specific types of businesses, including independent contractors.
Our commercial insurance agents can guide you to a policy that fits the needs of your business. Our agency offers policies from a variety of companies, not just one.
Bottom Line: Running a business is an investment, and every investment contains a certain degree of risk. No matter what you do, you will never be able to eliminate risk from the freelance equation, but by buying the right insurance at the right price, you can moderate the financial risk associated with unexpected events. Nothing is as precious as peace of mind.