If your business has been adversely affected by COVID-19 or other uncontrollable circumstances, the New Year may still bring more uncertainty for your company's financial future. In the process, you may have to scrutinize your business expenses even closer. One area companies will look at to save money is cost cutting with their insurance. But caution needs to be taken to ensure that you don't get short-changed with gaps in coverage or that you place your coverage with financially questionable insurance companies. The commercial lines staff at J.P. Perry Insurance suggests you consider the following strategies during rough times to help save on insurance costs while still covering your business risks.
Buy From A Qualified Insurance Carrier: Make sure you use a top rated insurance company with the financial strength who will be there when you need them. J.P. Perry represents over 20 of the nation's top insurers. Our staff can help you determine which one will provide the best coverage at the rate your business can afford.
Consider Strategies With Your Deductibles: Instead of reducing the overall limits of your policy to save money, consider larger deductibles. Deductibles can be increased on most liability policies up to $25,000 or more, without securing them with collateral. Higher deductibles could also be made on equipment and property. You just need to compare the payoff in premium savings with the higher deductibles against your ability to handle cash losses.
Review Your Company's Loss History: Each year you should check your company's loss history, and in some cases, review your credit score, as the company's president or CEO. These are indicators used by insurance company to determine your rates. An inaccurate report could cost you money. Higher reserves should be questioned and reduced, if possible, and old claims should be closed.
Promote Your Safety Program: The best way to reduce insurance costs and the less costly way to achieve that goal is to implement and promote a strong safety program. By implementing and documenting your safety processes, you could avoid claims that tend to be awarded at higher levels during bad economic times.
Pre-plan Your Insurance Renewal: Well before your insurance policy's renewal date, meet with your J.P. Perry agent to review your company's current and projected situation and coverage needs. This would give your agent time to consider options that could involve combining coverages and sharing limits; multiple year deals; negotiating your minimum earned premium percentages; and suspending coverage for vehicles not being used.
During hard times, the temptation is to drop coverage or reduce limits in order to save money. But your best strategy during hard times is to turn to your J.P. Perry agent who can help save you money while still covering your business risks.