We consulted our favorite business insurance agent and had him answer some questions about business insurances. Here are the questions and answers. Some questions and answers have been edited to fit better and some additional information may have been added to some parts. We have also had to add some new information as well. This is living content you know.
How to Find Business Insurance
You are looking for an independent insurance agent. When searching Google you will search for Independent Insurance Agent City State. (e.g. Peoria IL independent insurance agent) Do not use the word business inside of that search or you won’t get the proper results. Now open the example link and you will see some results. Some of the actual agents there are Coyle and Traders. For Coyle, you can find business insurance under products and services. For Traders, you can find business insurance under Commercial on the front page. Insurance companies are pretty well known for having websites that are not made super well so sometimes it takes time to poke around. It is best to just call and ask if they have business insurance instead of poking around the website.
What is the difference between an independent insurance agent and broker?
Basically, an independent agent works the same as a broker in that they work with multiple companies in order to procure the best coverage, policy and price for the situation. This is in comparison to a captive agent which only has one company available to them, such as State Farm or Allstate.
What are some advantages to business insurance?
In short, the advantage is to have someone else either pay for a loss to your property (either building or contents) rather than yourself. Perhaps If there is a liability loss, such as a slip and fall on your storefront property or a product of yours causes an injury, there is a huge benefit in that you can transfer the expense and time to fight that lawsuit to the insurance company, so that you can concentrate on your business.
Should all businesses get business insurance?
Yes. The number of lawsuits, frivolous (check spelling) or not, are increasing drastically along with the number of damaging storms. Either one of these events can bring a business down if the business/business owner was responsible for paying for it out of their pocket. Not to mention, if there is a bank-note on any business property insurance will not only be a good idea but will be mandated by the bank.
How long does it take to get business insurance?
It depends. A simple lawn mowing company may take no more than an hour. A bar or manufacturing plant will take much more time to complete. If at all possible leave at least two weeks in order to give an agent ample time to find the right policy with the right price for your particular business.
Can I get business insurance after I have started the business?
Yes, as long as there hasn’t been an existing claim. Many companies will not want to write insurance on a business that has been operating without insurance, however, so it may be more difficult, time-consuming and more expensive to find a company willing to write insurance on an existing, but uninsured, business.
How does business insurance work?
This really could be an hours long discussion, at least. However, in the interest of brevity, it works the same as what you would think your auto insurance or home insurance would. It is there to pay a claim or defend you against a lawsuit if something happens that causes injury to your property, someone else, or someone else’s property.
What are some of the difference kinds of business insurance?
There are hundreds of different types of business insurance. Workers Compensation, General Liability, Business Personal Property, Property, Liquor Liability, Commercial Auto Insurance, Commercial Umbrella Insurance, Inland Marine Insurance, etc. That is one of the main reasons why sometimes a business insurance policy can take an hour to obtain if it’s an uncomplicated business, or weeks if there are many lines needed.
Difference between companies like State Farm and independent insurance agents?
Captive agents such as State Farm, American Family, Allstate, etc. are only contracted to write with one company. Independent agents are contracted to write with as many companies as they wish, as long as they meet the contract requirements with that particular company.
How would someone find a good agent to work with? What are good questions to ask them to verify that they are good to work with?
Most important is to find someone you enjoy working with and is honest and straightforward. Everyone will have their own feelings on what’s important to them, but in my opinion one of the most important is if the agent has the willingness, patience, and knowledge of the coverage to take the time and explain what is being offered. If all you get is a price and limits, with no explanation of what those numbers actually mean in the event of a loss, it may be a red flag. Other than that, you could check with the BBB or the state department of insurance to make sure that agent/agency doesn’t have an issue with consumer complaints.
What companies should not be looked at for business insurance?
I don’t talk ill of any other company, but have not really ran into any that have stood out as a problem on a consistent basis.
Note: Do not look for business insurance from a captive agent such as State Farm, Allstate, etc. as they cannot provide you with a policy custom for your needs.
What is an underwriter?
It is an employee of the insurance company that works with an agent to review new business opportunities and determines whether or not it is a business that the company will be willing to insure. For instance, if an agent submits an apartment building to the insurance company for a quote, the underwriter may look at the submission and determine that due to certain criteria that building may or may not be something the company would want to insure. In essence they are the gatekeeper between the agent wanting to write the business and the company.
Can you give a basic checklist of insurances required for a retail shop? Is there the ability to do an average monthly cost of those as well?
No way to do an average monthly cost as it will be determined by each specific situation. Unfortunately, there’s really not a good way to have a basic checklist either. One retail store may need 15 different lines of insurance because of how they are set up and what they own/lease, whereas the same type of retail store may need only a couple. Talk to an agent, make sure he/she understands what your business consists of and what it owns/does, and they will be able to expand further.
What are your thoughts on business insurance?
Business owners spend a lot of their time, effort, and personal money to start a business and make it successful. One uninsured lawsuit or property loss can destroy and possibly bankrupt the business and business owner, negating everything they sacrificed to build that business. That makes it one of the most important things to consider when starting and maintaining a business.
What lines are available? What are lines?
Many, many lines of insurance are available. A different line covers different exposures to risk. An automobile line of insurance covers losses arising out of the use of an automobile, a workers compensation line of insurance covers losses arising from the injury of an employee, etc.
Workers comp? How does that work in getting and just in general?
Workers Compensation can be bought through pretty much any agent that sells insurance. It covers the business against the liability of an employee getting hurt during the course of his or her work. It pays for their medical costs plus any settlement needed if there is a more permanent type of injury. Each state has specific rules/regulations when it comes to Workers Compensation, even down to what is defined as an employee, so it’s important to know how your state handles it.
Unemployment insurance? Where does someone get that?
That is not purchased through an insurance agent. That is paid to the state just the same as you pay social security tax or sales tax.
How does unemployment work if you get fired? How can you get fired but still get unemployment benefits? (extra credit question)
Each state will have different rules and regulations so the state’s website should be consulted for up to date rules and regulations.
If you have any questions about business insurance that you can’t find and you can’t find a business insurance agent to talk with yet, please send us the question through the post advisor form and we will ask our insurance agent and post an update here.