Alera Group recently performed a study that foreshadowed an average business insurance rate increase of around 11% in the past year.
This survey included twelve of the most common lines of insurance, from medical malpractice to general liability and everything in between.
What does this mean for your small business?
If last year has taught us anything, it's the importance of having a safety net. The world can be unpredictable, so understanding the cost of business insurance is all the more critical.
Read on to understand what you will be paying for business insurance policy coverage in the current market.
Determine the Insurance For You
Pinpointing exactly what you are going to pay for business insurance is next to impossible without a precise business insurance quote from your provider.
However, we have narrowed it down to a science for you.
There are several factors that will influence your bill, and by utilizing these you will be able to have a fairly accurate idea of what you will be paying. All you have to do is plug your own business information into the model.
First, you will want to understand which type of insurance you need. Each insurance policy will factor in different pieces of information.
For example, General Liability Insurance is quite common and can rely on your company's square footage, the number of employees, and the industry you are in.
Commercial Umbrella Insurance depends on the policy itself, so if you require more coverage it will cost you more. But, if you have good credit, it will lower the business insurance cost.
Commercial Property Insurance depends on the location of your business, but in a very wide sense. Unlike other policies that depend on the population size of the city you are located in, this insurance is more geographical. If natural disasters are frequent in your area, prepare to pay more for property insurance.
Other Factors Influencing Cost of Business Insurance
No matter which insurance you are going to need, it is a good idea to determine where variances may come from.
Factors that could influence your policy price may include (but are not limited to):
• Business location - bigger cities tend to have a higher crime level, meaning higher rates
• History of loss - a clean track record means lower rates Industry and type of business - a large ax-throwing bar business may pay more in insurance than a paper supply store
• Business age - having a long legacy of growing revenue and safe practices can be very beneficial
• Source of coverage - certain insurance providers simply charge less than others for the same exact service
While it is impossible to know exactly how much you will pay for insurance, understanding these factors will at least put you in the ballpark. This way, you can determine if the price of your coverage is fair.
Get A Quote Today
If adding a new line of coverage for your small business is on the agenda for this year, check out this site for business insurance products.
Also explore the hundreds of other insurance and risk management articles within Bootstrap Business to learn more about business insurance or other types of coverage to reduce financial liability.
