As a business owner, you turn to insurance to help identify and address the unique threats to your goods, property, customers and bottom line. However, many wrongfully assume that once they’ve secured the proper coverage for their exposures, they no longer need to review their policies.
Here’s the truth — as your business changes, so do your exposures. There are a variety of scenarios that can have a direct impact on your level of risk and the amount of protection you need, such as:
- Your business has seen significant financial growth
- The amount of revenue you generate can impact the level of coverage you need. For example, disruption costs to your organization will be higher if you have a larger customer base and stand to lose more from prolonged closures.
- You add a new location or lease a bigger facility
- If your business has changed location or you have added a facility, you may need more property insurance. As a general rule, you should have enough insurance to cover the cost of rebuilding your facility and replacing the contents of it following an incident. In addition, renovations can cause the value of your property to increase.
- You hire more staff
- As you bring on more employees, you will need more workers’ compensation coverage. Many experts recommend purchasing well beyond the legal minimum.
- You purchase more vehicles or equipment
- With every investment you make, such as new vehicles, you will likely need additional coverage. Essential equipment will need to be insured, particularly if a breakdown could lead to closures and other disruptions.
- You make changes to your organizational structure
- When you hire a new business partner or add a member to your board, you will need to ensure you have the appropriate amount of directors and officer’s coverage. If any leadership leaves the company, check to see if you are overpaying for insurance.
Just one event can drastically change a business’s insurance needs. To secure the appropriate level of protection, be sure to regularly discuss any new developments when meeting with your insurance broker.