Why Marriage Status Is Necessary For a Business Insurance Quote

Marital status is just one among many rating factors (risk factors) commercial insurance companies may use in determining your business insurance quote.

Wedding rings
Marital status is needed during the insurance process.

As a rule, this particular factor affects auto insurance premiums but may also be used for calculating the amount you will pay (your premium) for life or homeowners’ insurance as well. In general, married individuals are charged lower rates.

Commercial Insurance companies use a complex process called “underwriting” to assess a person’s risk based on rating factors. While it is beyond the scope of this article to address that subject in-depth, we will briefly examine the factor of “marital status” and why it may affect the cost of your premium in certain instances.

Marriage Fosters Responsibility

Statistics have shown that married policyholders on average are less likely to take risks in their personal and business lives.

Married people are thought to be more responsible, perhaps due to increased family obligations. They tend to be more financially stable compared to single people and are less likely to file questionable claims.

These trends place married individuals in what insurance companies typically refer to as a lower risk class or category.

The lower the risk, the lower the probability of loss to the commercial insurance company.

For these reasons, married policyholders typically enjoy lower business insurance premium rates than their single counterparts.

By comparison, unmarried men under the age of twenty-five will generally pay the highest premiums, particularly in the case of commercial vehicle insurance.

This is another example of how marital status, coupled with other risk factors such as gender and age play a role in determining an insurance quote or premium.

 

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Let us help you find protection for your business and keep your mind at ease. At CommercialInsurance.Net, our mission is to help medium and small businesses manage risk by finding business insurance quotes at a reasonable price. To get a competitive insurance quote it is fast and easy, enter your zip code and click “Get Quote.” One of our specialists will contact you soon.

Benefits of a Business Owner’s Policy

In past articles, we have discussed the idea that a business owner’s insurance policy, or BOP, may be a good starting point for your new or small business. A BOP can cover many risks associated with a business while keeping the premium you pay in balance with a small business.

Two people wearing aprons smiling in a coffee shop.
Business owner who is happy with his business owner’s policy coverage.

Business Owner’s Policy Exclusions

A business owner’s insurance policy is generally quite inclusive. It is important for you as a business owner to review the specific coverage in detail with your licensed insurance professional. However, it is important to review the exclusions. You need to know what is not covered as well as what is. Here are some of the common exclusions to a BOP you want to be aware of as you consider a business owner’s insurance policy.

Commercial fleet insurance, also known as commercial vehicle insurance, is generally not covered in a business owner’s insurance policy. Since commercial vehicles are an expensive asset, it is important to maintain coverage on them.

The loss of a truck, a delivery van, or other commercial vehicles can be critical to your business and could have a serious impact on your business and its cash flow.

Debris removal insurance is also coverage generally limited by a business owner’s insurance policy. Businesses located in areas where tornados, hurricanes, and flooding exist may want to consider additional coverage.

Boiler and machinery insurance is often not included in a business owner’s policy. Review with your licensed insurance professional if this is coverage your business would need.

It is important to make sure you understand both the protection offered by your business owner’s insurance policy, and risk still exposed.

Get a Quote

Let us help you find protection for your business and keep your mind at ease. At CommercialInsurance.Net, our mission is to help medium and small businesses manage risk by finding business insurance quotes at a reasonable price. To get a competitive insurance quote it is fast and easy, enter your zip code and click “Get Quote.” One of our specialists will contact you soon.

How to Save Money on Commercial Insurance

Whether you own a retail shop, an auto repair shop, you’re a chiropractor or a dentist, you have insurance on your business and property. Like other business owners, you are feeling a squeeze and looking to reduce costs and we are often asked, “How can my businesses save some money without giving up anything?”

Adding up commercial insurance savings.
Adding up commercial insurance savings.

Unfortunately, while not an easy answer, there are steps a business owner can take to try and reduce their commercial insurance costs. Typically, General Liability rates have been ticking up. That doesn’t stop a smart owner from partnering with a good licensed commercial insurance agent to find ways to save some money.

How Do I Start Saving on Commercial Insurance

The first step is to examine if you may be able to eliminate double coverage. While we generally advise our clients to get the maximum coverage available, make sure your general liability coverage doesn’t offer product liability coverage while you are carrying a separate policy for product liability coverage.

Ask your agent for any safe driving discounts and monitor those employees who are driving company vehicles. Sometimes, one driver with a poor history can cause the rate to go up. Is there multi-policy or multi-product discounts available? Can you save on rates available to associations or organizations which your company is a member? Is it possible to increase deductibles to reduce the premium?

A key point to remember when working with your licensed business insurance agent is to set expectations of service which include an annual review and taking the time to answer all your questions.

 

Get a Quote

Let us help you find protection for your business and keep your mind at ease. At CommercialInsurance.Net, our goal is to get you an affordable commercial insurance quote. To get a competitive insurance quote it is fast and easy, enter your zip code  and click “Get Quote.” One of our specialists will contact you soon.

Commercial Vehicle: Personal Injury Protection and Medical Payments

We’ll begin with defining “commercial vehicle,” giving a general overview of personal injury protection (PIP) and medical payments (med pay), and then examining a few differences between the two as they relate to commercial vehicle insurance.

Commercial personal injury protection and medical payments.
Commercial personal injury protection and medical payments.

In general, a “commercial vehicle” is considered to be any vehicle used for business purposes. It can encompass a wide range, from your personal automobile in which you deliver your produce to the local farmer’s market, to the trucks used for your construction company and beyond.

The definition may vary from state to state; it is imperative you check with your commercial vehicle insurance agent who knows your specific state regulations. For instance, Colorado defines a commercial vehicle as a business vehicle which has a Gross Vehicle Weight Rating (GVWR) of over 10,000 pounds or a gross combined vehicle weight (GCVW) of over 10,000 pounds. As an example of the latter, your business truck may have a GVWR of 8,000 pounds with which you haul a 3,000-pound trailer. Your GCVW would then be 11,000 pounds which then meets Colorado’s criteria for a “commercial vehicle”.

Personal Injury Protection

Personal Injury Protection (PIP) is coverage which will pay for medical expenses and lost wages for you (the insured) and your passengers injured in an accident. It may also pay for funeral expenses. PIP pays whether or not you are at fault. In general, PIP does not have to be repaid to your insurer, even if you recover from a 3rd party. It is required in 16 states and the U.S. Territory of Puerto Rico.

Medical Payments

Medical Payments (Med Pay) is an optional coverage which will pay for medical expenses for you (the insured) and your passengers injured in an accident. Med Pay has no coverage for lost wages. It must be paid back to your insurer if you recover from a third party.

Differences Between Personal Injury Protection and Medical Payments

What are a few differences between PIP and Med Pay for commercial vehicle insurance?

Personal injury protection is more of a comprehensive coverage assisting with lost wages as well as paying medical bills.

Medical payments coverage will only cover medical expenses.

Some commercial vehicle insurance policies do not have PIP coverage.
Depending on your state’s regulations (for example, in Florida), subrogation of PIP payments is allowed if the insured’s vehicle is a “commercial motor vehicle”. Check with your insurance agent for your specific commercial insurance needs.

Get a Quote

Let us help you find protection for your business and keep your mind at ease. At CommercialInsurance.Net, our mission is to help medium and small businesses manage risk by finding business insurance quotes at a reasonable price. To get a competitive insurance quote it is fast and easy, enter your zip code and click “Get Quote.” One of our specialists will contact you soon.

The Difference Between a Captive and Independent Insurance Agency

An independent insurance agency is a company which sells insurance from one or more insurers, thus offering a wide range of choices from which their clients can choose. Captive commercial insurance agencies are limited to selling insurance from only one insurance carrier, that of their parent company and its affiliates.

Insurance agent is explaining the difference in insurance companies.
An insurance agent is explaining the difference in insurance companies.

Independent Commercial Insurance Agencies

Along with providing a variety of insurance carriers, independent insurance agencies are thought to offer their clients greater customization of policies, the potential for substantial savings in premiums from comparing those policies and are seen as representing you, the client and not an individual insurance provider. An independent insurance agent is not employed by the insurance providers which are represented by the agency. They are generally paid on commission or a percentage of the total price of the policy sold to their client.

As a rule, independent insurance agencies do not advertise on a national or international basis. Therefore, they do not enjoy the same name recognition as do their counterparts. Often the companies name will include the owner’s given name, for example, the “Joe Smith Independent Insurance Agency”.

Captive Commercial Insurance Agencies

A captive insurance agency is a company formed for and generally owned by, a parent company to underwrite its own insurance needs and those of its affiliates.

The majority of major corporations have their own captive insurance companies. Examples of corporate parent companies and their respective captives are Exxon-Mobile and Ancon Insurance Company, CBS Corporation, and Fidelity Insurance Company, Zurich Financial and Farmers Insurance Group, and, Allstate Corporation and Allstate Insurance Company. The latter two are examples of well-recognized, nationally advertised captive insurance agencies.

Non-profit organizations are increasingly forming their own captive companies as well. The University of Michigan and its Veritas Insurance Corporation is one example of this growing trend.

Agents working for captive insurance companies are limited to selling one product to their clients. Therefore, the policy that is offered is often viewed as less customized for the needs of the insured.

Get a Quote

We have plenty of options so let us help you find protection for your business and keep your mind at ease. At CommercialInsurance.Net, our mission is to help medium and small businesses manage risk by finding business insurance quotes at a reasonable price. To get a competitive insurance quote it is fast and easy, enter your zip code and click “Get Quote.” One of our specialists will contact you soon.

Does Business Insurance Come in a One Size Fits All Policy?

Is business insurance different for different types of businesses? For example, is engineers’ insurance the same as architect’s insurance or is, say, insurance for a doctor’s office doctor’s all the same thing? The answer is, no, and yes. Let’s explore what that means.

Commercial insurance representatives waiting to help.
Commercial insurance representatives are ready to help you now.

Types of Business Insurance

Every business needs at least one liability policy which we have discussed previously. A quick summary is that a liability policy will cover injuries caused to a third party.

Depending on the business, the size, the assets, and corporate structure will determine the types of liability policy for that business.

For example, a doctor will carry malpractice insurance like an engineer or architect, but the limits may, or may not, be higher. The architect and engineer may carry errors and omissions insurance where the doctor’s office may not.

Each business should carry a property and casualty policy to insure for losses against real or personal property. It might make sense to look at a business owner’s policy depending on the size and assets of the business. We will examine the business owner’s policies in the next segment in greater detail.

 

Different Industries, Same Process

In every situation, a business owner, whether a medical professional, an accountant, an architect, or a steam cleaning service, should examine everything that is of value and put together your insurance quotes based on that information.

In addition to a licensed insurance professional, don’t be afraid to seek guidance and input from your banker, your accountant, your trade association, and others who have an understanding of your industry segment. You also must consider the revenue stream and how an interruption due to a loss would impact your business.

 

Get a Quote

Let us help you protect your business and keep your mind at ease. At CommercialInsurance.Net, our goal is to help you protect your business as efficiently as possible. To get a competitive insurance quote it is fast and easy, enter your zip code  and click “Get Quote.” One of our specialists will contact you soon.

How Your Credit Report Will Affect Your Commercial Insurance Rates

Many business owners are totally unaware that their business insurance rate is affected by their credit report.

Learning about your credit score.
It is important to know your credit score.

Statistics show that people who have high credit scores file fewer claims than those with low credit scores and that they are less likely to have traffic accidents and traffic violations. Additionally, and more intuitively, much of the history provided in a credit report can be indicative of whether a business will pay its business insurance premiums on time or at all.

For that reason, federal law allows insurance companies to look at items from your credit report. Business insurance companies do not have to notify you that they are utilizing your credit report, so most of the time, you won’t even realize it.

How Business Insurance Credit Score Is Used

Business insurance rates are based on a narrow set of information which is available on your credit report, and business insurance companies are allowed to use only those specific types of information from your credit report. These items are collectively known as your “insurance credit score.”

The insurance credit score does not include the number which banks or mortgage companies use, which is known as your FICO score. Although your insurance credit score is different from your traditional FICO score, it usually follows the same trend. In other words, if your FICO score is high, your insurance credit score will usually be high.

Your insurance credit score includes such things as your pattern of monthly bill payments, collection activity, and the total number of outstanding loans as well as your total number of credit cards.

If you’ve missed credit card payments or defaulted on debts, insurance companies are unsure of whether you will pay them or not. Bankruptcy is going to cause a serious “ding” on your insurance credit report, resulting in higher business insurance rates. The business insurance rate will, however, be adjusted once the bankruptcy “drops off” of your report, usually seven years after it was discharged.

It is important to note that under the law, your business insurance rates cannot increase if you do not have enough credit history to calculate a credit score.

Inspecting Your Insurance Credit Score

If you want to see what your insurance credit score is, you can buy a copy of the report from True Credit, which is a division of Transunion. The website for True Credit is http://www.truecredit.com/insurance.

You will want to review your insurance credit report and ensure that the items included therein are correct. It is important that you do this in order to get the best business insurance rate you can find.

More on Specific Uses of Insurance Credit Scores for Business Insurance

When you apply for business insurance, the rates are determined by your insurance credit score.

What Items are Considered for an Insurance Credit Report?

Let’s take a look at just which items on your credit report are considered and which are not.

The insurance credit score was developed specifically for insurance purposes, and it is not the same score that a mortgage company or a car dealership would be looking at.

Instead, it takes into account the areas of your credit report which apply to the insurance industry. Some of the items your business insurance company will look at in this regard are:

  • how many credit cards your company has
  • how many outstanding loans and other debt your company has
  • your timeliness with which your company pays its monthly bills
  • collection activity, if any
  • how long the credit history goes back

On the bright side, it is against the law to deny an insurance policy based on the lack of history in one’s credit report.

These are some of the things that insurance companies are NOT allowed to use when looking at your insurance credit report.

  • The amount of credit available.
  • The number of credit inquiries contained in your company’s credit file.
  • Type of credit history or not enough credit history to develop a score.
  • The types or issuers of credit cards and debit cards carried.

By law, you are entitled to inspect your insurance credit report, just as you can your overall credit report. You should review it from time to time to be sure that the information there is factual. If the information there is incorrect, there are methods by which they can be corrected or updated, just as there are on the traditional credit report.

In order to get a copy of your insurance credit report, you need only contact Transunion’s True Credit. Their website is at http://www.truecredit.com/insurance.

Get a Quote

Let us help you find protection for your business and keep your mind at ease. At CommercialInsurance.Net, our mission is to help medium and small businesses manage risk by finding business insurance quotes at a reasonable price. To get a competitive insurance quote it is fast and easy, enter your zip code and click “Get Quote.” One of our specialists will contact you soon.

Find the Right Commercial Insurance Agent

 

Value is a word often bantered around in the commercial and personal insurance world. Well then, just what is “value” as it relates to the licensed commercial insurance agent providing your business with insurance?

A Group of Insurance Agents.
Insurance agents waiting to earn your business.

At this point, there is no magic wand to wave to produce the ideal agent or broker. An engineer’s business insurance needs will differ from a retail store’s insurance needs or a veterinary clinic’s insurance needs.

Instead, let’s turn the focus on what you feel you need to achieve value from your insurance professional.

At a minimum, we suggest at least an annual review with your commercial insurance agent. An annual review is NOT “Here are the latest premiums. Sign here.”

Instead, you should expect a review of your business, go over any changes or upcoming changes with your business since you last spoke, and what has changed in the insurance world with your licensed business insurance agent.

Depending on the type of business you have, the risk your business carries, and how fast your business is growing or changing, we also recommend a quarterly update phone call. More or less contact needs to be determined by you as the client. Is your commercial insurance agent or broker genuinely interested in your business and not just the commission?

The bottom line is to set an expectation of what you want from your commercial insurance agent and then get mutual agreement when moving forward. Your commercial insurance agent should be one of your most trusted advisors and not just a transaction.

Let us help you protect your business and keep your mind at ease. At CommercialInsurance.Net, our goal is to help you protect your business as efficiently as possible. To get a competitive insurance quote it is fast and easy, enter your zip code above and click “Get Quote.” One of our specialists will contact you soon.

Choosing the Right Insurance Company

Selecting the right insurance company is every bit as important as choosing the right type of insurance coverage, since the financial soundness of a company may affect its ability to come through for you when you need it.

Insurance Agent and Clients Going Over Policy Information.
Insurance Agent Helping Their Clients.

Few of us are equipped with enough of the necessary information to be able to make financial comparisons between insurance companies. Instead, we can turn to the independent evaluations of insurance rating companies, such as A.M. Best & Company, Fitch Ratings, Moody’s Investor Service, and Standard & Poor’s. Each of these agencies uses its own terminology, and rating scales that don’t match up exactly, so you should look at, and understand what the ratings mean.

While there are slight differences in the methods of evaluation used by each of these companies, the ratings that they issue do allow us to make comparisons between the insurance companies in the market, particularly in factors such as financial stability, which may determine the company’s ability to pay on a claim. In viewing the ratings provided by each of the rating services, we can determine the strength and stability of the insurer. The higher the rating, the more reputable and financially solid the insurer.

Their ratings are similar to report cards that are issued in school, with A being the best, then B, and so on, but with variations. It is also important to understand that many, if not most, companies will receive an “A” grade of one sort of another, and any company with a “B” or lower probably shouldn’t be considered.

The oldest of the five major rating services is A.M. Best, which focuses on its evaluations of the insurance industry. In its rating system, A++ and A+ ratings are considered “superior”, an A and A- rating is “excellent”, and B++ and B+ are “very good”. Anything below that indicates that a company may be vulnerable to financial difficulties in the future. Standard & Poor’s system holds that any rating below an “A” should be considered vulnerable.

An insurance policy is only as good as the company that issues it, and recent economic conditions highlight the importance of knowing the financial stability of the insurer you will be doing business with.

 

Advantages of an Alarm System on a Business Insurance Policy

Installing an alarm system is one of the most prudent measures a business owner can take to manage risk and reduce the level of possible loss of life or property. Lowering your business’ risk exposure and loss will help reduce claims.

Alarm Installation
Alarm installation can help cut insurance premiums.

Most insurance companies will offer a discount on your business insurance policy premiums if you have installed the appropriate, qualified alarm systems specifically tailored to your organization. In some cases, companies will require installation prior to insuring your business.

Fire and burglar/security alarms are the two most commonly installed systems in business and commercial buildings.

Fire alarms are generally required for businesses to meet local, state and federal fire codes. These systems range from the simple to the sophisticated, depending upon the size and scope of the business.

Beyond the fire code requirements, your insurer may mandate a specific type of qualified fire alarm system you must install in order for your business to be insured.

Most business insurance policies require your fire alarm system to be connected to a 24-hour “central station” monitoring system (other than your local police department) in order for you to get a discount on your premium. They may also require the installation of an Underwriters Laboratories, Inc. (UL) certified fire alarm system.

Burglar/security alarm systems have proven to reduce the risk of business theft and loss. Your business insurance policy premiums may be reduced depending upon the type of system you have installed.

It behooves you to contact a few different security alarm system installers to have them examine your facility and premises to determine your business security needs.

As with fire alarm systems, prior to purchase and installation, discuss with your insurer which burglar alarm systems may qualify you for business insurance policy discounts.

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