by Marie King
Buying insurance for a small business can be confusing. Beside all the insurance products to choose from, policies contain insurance terms that you may not understand but are crucial to making a smart purchase. You want to buy insurance that fits your needs and is cost effective.
When you buy insurance for a small business, the insurer may have the right to audit your business to determine whether you have enough coverage. If you are over-insuring your business, you can expect to save money on your policy. More often you might find that you need more coverage, which will leave you with higher premiums.
Annual deductible refers to how much your deductible costs in a year. Insurance for a small business can have a deductible that ranges as low as $250 or as high as over $10,000 or more. Understanding the cost of your deductible, allows you to choose a policy with an affordable deduction that lets you set aside money for the annual deductible cost.
When buying insurance for a small business, you need to pay strict attention to exclusions.Exclusions are items not covered by your policy. Many times consumers will purchase unknowingly insurance that they assume has the coverage that they need. However, often the purchasers don”t find out about the gaps in their coverage until after they file a claim and the claim is rejected.This leaves the consumers left to pick up the total expense of the claim.
Inclusions detail what is covered by the insurance for a small business, which you have bought.You need to study carefully what’s contained in your inclusions. You may find out that your policy has significant gaps. Talk to your agent, so that your agent can help you fill the gaps.
When you purchase insurance for a small business, you may want to add the names of people who are not covered in the original policy. Since it’s your name on the policy, the people you add to your insurance may be considered additional insured.When you add these people, the addition may be referred to as an endorsement or rider, depending on the type of insurance coverage you’re expanding. Both the rider and the endorsement must be documented on your original policy to be in effect.
A binder is an agreement between you, your agent and your insurance company that outlines the terms of your insurance for a small business. The binder is issued in lieu of a policy. The binder is a temporary document until you get a copy of your policy. Most policies arrive in less than thirty days after you’ve received a binder. In the interim, the binder fulfills the role of a policy when it’s used as proof that you have insurance.