Fire, weather, crime, negligence, bad luck—accidents come in every shape and size. Insurance carriers are fond of saying they protect you from such mayhem. In reality, small business insurance protects your financial investment, funding your ability to recover from a loss and get back to the business of running your business. No one knows more about how to structure this protection than your independent insurance agent.
1. Independent Insurance Agents are Professional Risk Managers
Dig into how insurance is provided, and one of the first things you’ll notice is that businesses are segmented into different risk categories. A carrier’s risk appetite, which is every category of business the carrier is willing to cover, is the first thing an insurance agent looks at when working to find coverage for a small business owner. Coterie Insurance, for example, covers a whopping 80 percent of the small business market, including those hard-to-place micro, gig, and home-based businesses—none of which are covered under a homeowners policy.
Daily immersion in risk awareness makes your independent agent invaluable in helping you understand and cover your risk exposures. Certainly, the human brain seems hardwired to ignore everything but extreme risks: this is how we engage readily in high-risk behavior, like driving a car. Independent insurance agents train their brains to recognize risk. They are experts at understanding which risks are relevant to which small business category. And they are your greatest ally in making sure you are properly insured.
2. Small Business Insurance Policies are Complex
No matter how easy we make it for your insurance agent to quote and bind coverage for your small business, your insurance policy remains a complex legal document. If you suffer a loss, the only thing that matters is the language contained within the pages of the policy, often referred to as, “The four corners of the policy.” No one speaks this language more fluently than your independent insurance agent.
The complexities in policy language exist because insurance policies aim to describe everything the insurance carrier will or won’t cover, and under what circumstances. Certainly, policies vary in the coverage included.
For example, traditional carriers who write some small business typically do so by forcing the small business owner to go through the same time- and labor-intensive application processes as large commercial applicants. If approved, the limits are scaled down, but the excess coverage is left in the policy. Would you know if the policy you’re considering for your small business contains coverage you pay for, but don’t need? Your independent insurance agent knows. They are licensed, educated, experienced professionals who exist to help business owners just like you.
3. Coverage Applies Differently Among Insurance Policies
Another key role your agent plays in finding you the right coverage is knowing how that coverage will be applied in the event you suffer a loss. Some policies are structured to pay all covered expenses up to the limit of the policy. Others are structured to pay specified losses separate from the policy limit.
Defense costs, for example, eat coverage dollars like snacks. Many general liability policies pay these costs inside the policy limit. By comparison, Coterie’s small business insurance policies pay defense costs outside the limit—a huge difference in coverage if you’re being sued.
Coverage differences also exist between:
- Replacement cost policies, which pay to replace damaged business property (other than buildings) with new property of like kind and quality, up to the policy limit.
- Guaranteed replacement cost, which pays to replace damaged business personal property with new property, even if the total amount exceeds the policy limit.
- Actual cash value (ACV), which pays the value of the insured items as they were the moment before the loss.
Knowing how much coverage is needed and how it will be applied if a loss occurs is your independent insurance agent’s duty.
4. How Much Should Your Small Business Insurance Policy Cost?
Insurance cost is a key consideration for every small business owner. But how do you know if the price you’re being quoted is a fair price for the coverage? That’s right, you get your quote from your independent insurance agent. It’s like they have a sensor implanted in their gut that goes off when a policy costs too much. Of course, they also have the expertise to dig into the policy and find out why it’s priced the way it is. Maybe it’s the limits. Maybe it’s the deductible. Maybe it’s bloated coverage. Maybe it’s how the coverages are applied. Maybe it’s just expensive.
Without the expertise an independent agent brings, how would you navigate this critical analysis?
5. Independent Insurance Agents Invest in Your Success
Having insurance protects you and your small business from the economic devastation of loss. Thanks to ever-smarter technology, it’s possible to offer self-service commercial insurance. But because it’s possible, doesn’t mean it’s wise.
Your business is your lifeblood, the embodiment of your dreams, your work, your investment, your future. From finding the right coverage with the right deductible, premium, and claim service, you deserve the best protection you can get. If you don’t have an independent agent, find one here today.