Although cutting back on the insurance component of your risk management program might seem to make sense In today’s troubled economy, an uninsured or underinsured loss could easily cost you dollars for every penny you’d “save.”. Here are five ways to stretch your insurance dollar without having to compromise on coverage:
- Take an inventory of your business property and determine its value. Then decide what kind of protection and level of coverage you need. Don’t buy insurance to protect against highly unlikely risks, but don’t hide unusual risks from your agent. Be sure to keep the inventory in a safe, off-premises place.
- If you find a package or standard policy to cover your needs, go with it. In most cases, it’s less expensive to add riders than to get a custom policy. Also, if a dispute develops, ambiguities in a package or standard policy might be interpreted in your favor against the insurer. The same might not hold true for a custom policy.
- An inexpensive policy might not be preferable and could be more expensive in the long run if the coverage is inadequate. Check to see what and who is covered and isn’t covered. You should also verify the long-term, multiyear financial stability of the insurance company that you’re considering.
- Choose a higher deductible or self-insured retainer and know the differences between them, including cost differences. The higher the deductible or self-insured retainer, the lower your premiums. The total cost of Liability insurance will also depend on how much coverage you place in each of three types of policies: General or Basic, Umbrella, and Excess. Understand the differences among these policies and allocate your coverage amounts among them to maximize your coverage and minimize your cost.
- Find a trade group or professional employer organization policy. Trade organizations can, and often do, negotiate good rates and better insurance terms for their members.
Our risk management specialists would be happy to advise you on tailoring a cost-effective protection plan to your needs. Just give us a call.
