HomeBusiness InsuranceInsurance panel gives tips for Hoover small businesses

Insurance panel gives tips for Hoover small businesses

Insurance costs are rising due to multiple factors, but there are things business owners can do to try to lower their premiums, a group of insurance professionals told the Hoover Small Business Alliance Wednesday morning.

About 75 people showed up at Aldridge Gardens to get an “Insurance 101” primer for small businesses from four people in different parts of the industry.

Cory Blankenship, a property claims manager with Travelers Insurance, said last year there were a record number of insurance claims filed due to catastrophes.

“That’s something that’s passed along to all of us consumers, whether personal insurance or business insurance,” Blankenship said.

Emily Thrasher, an underwriting consultant with CNA Insurance, said weather patterns affect insurance rates, whether it be an increase in the number of tornadoes, high-wind events, hail events or other storms. They can be hard to predict, but when there is an influx of them, rates are likely to go up, she said.

Attorney Paul DeMarco, who served as moderator of the panel discussion, said some people may not understand why their premiums went up when they didn’t file any claims.

Thrasher said an increase in insurance rates isn’t necessarily directly related to what happens with an individual business. If there are greater losses happening in a particular industry, every business in that industry could be impacted, she said.

The general legal climate also affects rates, Thrasher said. “Anybody in this room heard the words ‘social inflation’ or ‘nuclear verdict?’ Those are just fancy ways of saying that plaintiffs are demanding higher and higher payoffs for their damages.”

However, there are some things business owners can do to lower their premiums, the panelists said.

Karl Peterson, vice president for AlaCOMP (a workers’ compensation company), said some insurance companies have people who can visit businesses to evaluate risks and offer suggestions to mitigate risks.

For example, companies can evaluate work stations to determine if employees are using the safest and healthiest practices as they go about their tasks, Peterson said. Companies can provide training in proper lifting techniques or make sure employees have the most ergonomic chairs and desks to avoid people being hunched over their computer all day or help workers avoid carpal tunnel syndrome, he said.

Thrasher said having company policies and procedures in writing also can lead to better rates because those things help prevent problems from happening, whether that be a human resources manual, a fleet safety program or practices and procedures to prevent slips and falls, such as routinely making sure there is no water, trash or debris on the floor that might cause someone to fall.

Also, if a business owner sees a particularly highly priced line item in their insurance policy, they should talk to their agent to see if there are ways to lower that, said Anna Price O’Connell, an independent insurance agent with Insurance Facilities.

For example, a business owner might be able to reduce insurance costs by, instead of providing insurance for an employee’s vehicle, giving employees a vehicle allowance and making sure the employees have a certain amount of personal insurance coverage, Price O’Connell said.

Having video monitoring of a business also can help reduce risks, but it’s important not to delete the videos, Price O’Connell said. DeMarco said videos definitely have an impact on ligitation because it’s visual proof of what actually took place in incidents.

DeMarco asked what kinds of insurance most businesses need to have.

Price O’Connell said property insurance is important as well as general liability insurance to cover any bodily injury or property damage for which a company could be held liable. Some companies over a combined policy to cover both of those, she said.

Other types of insurance companies may need include managers and owners’ liability insurance (for when directors or officers are held responsible for decisions made), employment practice liability (for wrongful termination or other employment issues) or cyber liability insurance (for losses related to cyber attacks or data breaches), Thrasher said.

Peterson said Alabama requires any company with five or more employees to have workers compensation insurance, but a company with fewer than five employees still can be held responsible for employee injuries or illnesses under certain conditions.

Price O’Connell said that, often, the types of insurance a company needs will depend upon what is written in any lease agreements or franchise agreements, if they have such agreements. Business owners need to make sure their agents have those documents to make sure the business is covered properly but not over-covered, she said.

Blankenship said it’s important for both tenants and landlords to have a clear understanding of their responsibilities under the law. That way, each party can tailor their coverage limits based on their level of exposure. For example, a business probably won’t need $1 million worth of property coverage if the only thing in the building for which they are responsible is the wooden floor, he said.

DeMarco asked how a business owner can know whether they should file a claim with their insurance company or just cover the cost themselves to guard against increases in premiums. Blankenship said it’s a delicate balance. If you have a $5,000 deductible, you might not want to file a $7,000 claim, he said.

However, if you think you might be sued for something, definitely file the claim and let your insurance company know about the situation as soon as possible, Thrasher said. “They need to know.”

Also, if you know you’re going to file a claim, it’s best to involve your insurance carrier as soon as possible because the insurance company might can work better with any other responsible parties to cover losses or work with contractors to make sure that repair work is covered under the insurance policy, Blankenship said.

On another topic, shopping around for a new insurance provider in search of lower rates is OK, but it can hurt you if you do it too often, Peterson and Thrasher said. Insurance companies may not want to work with someone who is constantly switching insurance providers because they may see it as a waste of time, Thrasher said.

For more information about insurance for small businesses, see the U.S Small Business Administration website.

Source link

latest articles

explore more