At some point in time, New York business owners may have a need to switch commercial insurance companies. Whether it’s due to a steep premium increase, being non-renewed, or your agency losing its appointment with a carrier, occasionally a situation may arise when you will have no choice but to consider a change.
Should you find yourself in this situation, here are some pointers for when it comes to shopping your commercial insurance:
Review Your Exposures
Since most businesses owners hold on to the same policy for many years, more than likely your business has changed since the policy was written, potentially creating an under-insured situation. This is a great time for you to have a new broker underwrite your business to make sure you are properly insured. After all, what good is paying for a policy that will not properly indemnify you in the event of a loss?
Information to Have Ready
In order to have your business underwritten for coverage, a series of questions will be asked in order to obtain information specific to your risk type. Thus, having the following information readily available will help speed up the underwriting process, as well as give your insurance broker the means to best serve you:
-A copy of your most recent commercial insurance policy declarations (general liability, worker’s comp, inland marine, building, etc.)
-Three years worth of loss runs (if you have had claims). Your current carrier can provide you with this information via written request
-Financials (estimated payroll for the upcoming year, gross receipts over the previous year)
-Structure data (e.g. square footage of the retail space, of the warehouse, and for the entire building if you lease a space, year of construction, security system, building improvement dates, etc). If you are leasing, your landlord will have this information
Even with all this information provided to your insurance broker, there are times when they will need additional information to fine tune your quote. The faster you can provide them with this information, the better they will be able to help you.
Mid-Term Cancellation Penalties
While you can switch carriers at any time, cancelling a commercial insurance policy mid-term will result in a short rate penalty for the insured. Typically, the amount of the penalty is 10% of the annual premium. Thus to avoid these penalties, the ideal time to begin shopping your business insurance is 2-3 months before your next policy renewal. Plus, you will want to give your broker plenty of time to find the best choice of carrier to obtain a good balance of coverage, pricing, and service for your business.
Your business is successful because you take it seriously. The same applies to risk management professionals…they are serious about protecting you. Thus, the more effort you put into shopping your commercial insurance, the better results you will yield.