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Nine Questions Business Owners Need to Ask Their Insurance Agent
One false move, one small error in judgement or one storm can put your entire life’s work at risk. Are you putting your business at risk by having the wrong type of insurance? Is your current insurance company the right fit for your business needs? Are you sure? Are they your insurance company because you’ve used them for years? Or is your insurance agent your friend and he’s always insured your business, family and neighbors?
These are a few questions that I hope to explore with you. Your business is your life’s work. You’ve spent blood, sweat, tears and serious money getting to where you are in life and you can’t afford to get it wrong. Your Business Insurance should be the last thing on your mind. But it needs to be on the mind of your Professional Insurance Agent.
Outpatient Medical Offices, Dentist, Veterinarians and Funeral Directors are a very unique highly skilled group of professionals. The pitfalls in your business are too many to count. The price is too high for failure. It’s your business. Make sure you’re using an agent that will handle it with care.
I know the challenges in today’s business world aren’t easy to navigate through. The State and Federal government are imposing many rules on your business. Your business contracts are lengthy and complex. The cost associated with business are always going up and hardly ever staying level. Your clients expect perfection at every encounter. You’ve entrusted your life’s work to the employees that you’ve hired and you hope they are living up to your high standards.
Large corporate businesses are squeezing out their smaller competition. Small businesses often times don’t know where to turn for help. As a result, they’re often left paying too much for their business costs and not having what they really need to do the best job for their clients, patients and employees.
I get it. I’m a small business owner too. I don’t fix teeth, bury the dead, align spines or operate on dogs but we insure a lot of the folks that do. And we do a great job doing it. That’s why I decided to write this book to help you navigate through the insurance maze for your business.
You’re not going to be an insurance expert after you read this but hopefully you will know more about how to properly insure your business than you did before. Leave the insurance stuff to us and we’ll leave your professional expertise to you.
Single Largest Insurance Pitfall for a Profession Office
If you’re like other professional business owners, you’re really good at what you do. You’ve spent many years learning your profession, spent many thousands of dollars toward your education and invested your life’s savings to open your business. You don’t have time to micro manage every aspect of your business. But if you’re not doing it and you’ve not delegated the little things to someone you can trust, who’s taking care of your business?
Reviewing your insurance policy shouldn’t be one of those action items that you never review and take time to evaluate. Things change, times change, vendors change, operations change, government requirements change, client expectations change; you get the picture.
When was the last time you spoke with your professional insurance agent to discuss each of the items above? Last year’s policy renewal? Two years ago, Three years ago, NEVER???
In my opinion, the Annual Insurance Review is the most neglected task that Professional Office owners fail to do. Why? Because you’re busy? You never think of it? You hate paperwork? All of these are good answers but if a claim happens, these excuses won’t fix an oversight to pay the claim.
Demand from you current agent that an Annual Insurance Review is a part of your Office Insurance program. This simple review only takes a few minutes of your time but it could prevent an oversight that could cost you thousands, if not everything.
When is the best time to do an insurance review you ask? “Today” is the answer. Insurance claims are never expected and when they happen and your policy is not up to date, you’re risking a lot. An insurance review done by an Insurance Professional usually takes about an hour. This one hour per year can be the difference between a covered or denied loss. Don’t take the chance. Get your review scheduled today!
Gaps in coverage that can put your Business and Livelihood at risk
Imagine just for a moment that these are actual conversations with your insurance agent named “Frank”.
“Frank, one of my longtime clients just called and said they’re identity has been hacked and it’s been traced back to my business. My client said they’ve hired an attorney and this could be costly. They said they just wanted to let me know. What should I do Frank?”
“Frank, I’m calling to let you know that my employee was running an errand in her car to pick up stamps and do the bank deposit. She ran a stop light and… well…. it’s bad. REAL BAD. She’s ok but pretty banged up. The other driver is critical. Am I covered Frank?”
“Terrible news Frank, my office burned down last night. Nobody was in it. There were a few dogs and cats that didn’t make it. I’ve lost everything. I’m in a mess. My records are destroyed and I don’t know what I’m going to do. How am I going to recover from this? My employees are like family and I’ve got business and personal debts to pay. Frank, please tell me that I’m gonna be OK…..”
“Frank, I had to let an employee go last month. It got kinda ugly and now I’ve received a letter from their attorney stating their putting me on notice. It says that I’m being sued for “wrongful termination. I didn’t do anything wrong. Am I covered for this Frank?”
As you read this, what’s the first thing that comes to mind? You’re probably thinking “am I covered? Can my business survive this?” What about your liability limits, correct coverage for your Property, Auto, income disruptions, employment practices, worker’s compensation, etc….. Who’s going to pay for the medical care for my employee, their lost wages, and other big issues? Do you have coverage for a data breach? Are your liability limits high enough for all the damages? Do you have enough coverage for the fire destruction? Can you make payroll next week? The list of “What if’s” are endless.
These aren’t pleasant scenarios are they? Your heart beat is probably beating a little faster after reading this.
But there’s hope. Discussing your business operations annually with your professional agent will make sure that the gaps that are in your business insurance plan are plugged and filled.
When’s the best time to discuss these insurance gaps with your agent?TODAY!
Several key questions to ask your current insurance agent
When you’re choosing an insurance agent to buy and service your Business Insurance coverage, there are some key questions you should ask.
Why did you choose this specific insurance company for my coverage?
How many insurance companies do you access for my specific needs?
What is your experience in the Business Insurance industry?
Do you offer and follow-up with Annual Insurance Reviews? If so, how?
Is the coverage offered adequate for my professional business needs?
Is there any insurance coverage that you’ve not offered to me?
Should a claim occur, how do I file the claim quickly and easily?
Many insurance agents only have access to ONE insurance company for your coverage. This often happens when you’re dealing with your Home/Auto insurance agent for your Business Insurance needs.
One insurance company might do the trick but sometimes more choices are better. If your agent can shop many insurance companies for your specific business needs, you win.
Choosing a Business Insurance agent that doesn’t “Dabble” in the business. Make sure they know what they’re doing. Your professional business depends on the team of experts that you surround yourself with. I’m sure you wouldn’t hire an Eye Doctor to perform Heart Surgery. Don’t hire an agent that “Dabbles” in business insurance.
An agent that schedules annual insurance policy reviews are worth their weight in gold. These reviews are the secret to protecting your business with adequate and correct insurance coverage.
When your agent finds out what type of type of professional you are, this should pin point some specific coverages and options. Don’t pull your agent through the process; they should be leading the conversation.
This question should be answered with a NO. If your agent has done their job, you will be handed some options to either buy or decline. Your professional agent should offer insurance products that will adequately protect your business. It’s up to you whether you buy them or not.
Claims should be easy to file. Know what is expected of you during a claim and stay in touch with your agent
Policy premium payments can be billed in several ways. Direct billing is from the insurance company. This is my preferred way to bill our professional insurance clients. Agency Billing is all handled through the agency and is another step in the process. Premium Financing is often used when the other two options aren’t a good fit. The down side to Premium Financing it the amount you will pay in interest charges for your policy premium. Find out from your agent what they use and is it the best option for you.
Don’t accept being ignored throughout the year. Wouldn’t it be nice to get a call periodically from your agent just to check on you? I thought you might.
Finding Really Good Business Insurance at a Great Price Shouldn’t be this Hard
Have you settled for the fact that Business Insurance is just plain expensive? Well you don’t have to. Don’t give up yet. There’s good news.
I’ve found over the years that many business owners are taking charge of their best business practices. There’s a few ways to take charge of your insurance pricing.
First; make sure the insurance agent that you are using or considering using is knowledgeable about your industry. Your car and homeowners insurance agent is probably a great guy or gal but are they educated in the art of providing great business insurance guidance? If they are, you’re very fortunate. If they’re not, seek out an expert. It’s your business. It’s your livelihood.
Second; how many top rated insurance carriers does your agent have access to? Does your current agent only sell for company? Is your agent able to quote your insurance coverage with more than one insurance company during the “shopping phase” for your business insurance?
Third; Is your insurance policy being marketed to some of the best companies in the industry? There are many fine insurance companies in the industry but not all insurance companies are alike. Their coverage options will vary depending on your industry type. One company may have a great insurance policy product for a Childcare Center but their Dentist Office policy may not offer key coverage that you’d expect and want.
One More Tip; Choose an Insurance Coverage Specialist. I know what you’re thinking. You’re trying to run your business and you don’t have time to micro manage your insurance agent. You expect them to know what they’re doing, do a good job for you and charge you a premium that’s fair and honest. A good agent will search for the best insurance company, coverage and pricing for your specific needs. The key is to have a good agent that understands your business.
Insurance Coverage that Keeps your Bills Paid and your Business Doors Open.
I’ve done countless Annual Policy Reviews with my clients over the years and one thing for certain; changes are always going to happen.
Remember my earlier comments about Annual Policy Reviews? I’m not going to beat that dead horse again (no offense to my Vet friends), I promise. But making sure you’re covered correctly is the job of your professional business agent.
Property Insurance; “I’m sure I’m covered correctly. My agent said he has covered everything.”
Property Insurance coverage for your business should have the basic of coverage. These would include but not limited to:
But what about your income losses due to tornado damages to your roof? Can you still pay your employees while your business is being repaired or rebuilt?
While rebuilding, you discover that the city building ordinances require upgrading your building to the new codes. Is your policy going to pay for these upgrades?
Lightning strikes your power supply, knocks out your refrigeration and your valuable cold items are lost. Is this a big deal for your business? Some professional offices have cold stored items that are very expensive to replace and aren’t aware of the gaps in their policies.
Workers’ Compensation; “I only have a few employees, and I consider them like my family. I was told that I don’t have to have Workers’ Compensation Insurance.”
Workers’ Compensation insurance is required by law in most states. But in my professional opinion, whether you have 1 employee or 50, as a business owner you need this coverage.
Workers’ compensation insurance can help protect your business and employees in events like these:
An employee slips on ice, injures himself while walking up the stairs to the office, and requires an emergency room visit and weeks of recovery time.
An employee injures her back lifting a box of printer paper and requires a doctor’s attention, medication and physical therapy.
An employee returning to the office from visiting a client is injured in a car accident and requires hospitalization.
When an employee gets hurt due to a work related injury or illness, your workers’ compensation policy will be your best line of defense to protect your business from the high cost of medical bills, long-term treatments, possible new training and transitional work requirements. This coverage could very well keep your business from losing everything.
Business Auto (Hey Boss, it’s just a quick errand. I’ll take my car.)
Business Auto Insurance helps your business cover the financial costs resulting from an auto accident if you or an employee is found at fault. Commercial auto insurance helps pay for damaged property and medical expenses – even in the event of a fatal accident.
Business auto insurance will help protect you, if:
An employee hits a pedestrian while driving a company truck and the pedestrian requires medical treatment that results in substantial bills.
You accidentally swerve off the road while driving to work and take out a residential mailbox and have to pay for the damage.
An employee driving to work accidentally hits another car and totals it.
Your employee drives their car to the post office to pick up stamps for you after lunch and runs a stop light and hits a school bus. Their car, your errand. Do you have coverage? Make sure your business is protected.
General Liability Insurance (My business is being sued and we didn’t do anything wrong)
General Liability Insurance helps protect your business from property damage claims, bodily injury claims, and even personal and advertising injury claims that could put your business’s assets at risk.
For example, General liability insurance helps protect you and your business in the event of the following:
A customer slips and injures himself in your store. The injuries result in costly medical bills and maybe even a lawsuit.
While on the job, you accidentally damage a customer’s property and the repairs are costly. If a claim like one of these were made against your business, then your commercial general liability insurance policy may help pay for the damages.
What about being sued for things like negligence, libel, slander, property damage, bodily injury, copyright infringement among other things. And businesses can be sued even when they did nothing wrong. It’s the nature of doing business today. It’s a shame it’s like this now but I don’t see things getting better anytime soon.
Professional Liability Insurance (I gave them bad advice and now their suing me.)
Professional liability insurance helps cover you and your company if you are found negligent in the professional services you provided.
For example, if you make a clerical error that costs a client thousands of dollars or if you work as a Dentist and your patient sues you because of a misdiagnosed treatment that causes a long term medical problem. Or as a Chiropractor you give the wrong advice and your patient sues you and your practice for pain and suffering.
These situations could have costly legal repercussions or in other words, they could cost you everything.
Professional liability insurance will help cover the costs and fees associated with the incident.
Many of my clients choose to purchase this coverage through my insurance programs because they’ve found that it is more superior coverage compared to their Professional Association’s policy offering.
If you work directly with customers, patients and clients by providing a service, you should definitely consider a professional liability insurance policy.
Data Breach / Cyber Liability Insurance(I thought my computer network was secure but I think I’ve been hacked. Now what do I do?)
When a data breach occurs, quick action is important to help restore your client’s confidence in your business. Cyber liability insurance and data breach insurance from can helps cover costs like notification, identity protection solutions, public relations, legal, liability and more depending on the coverage you choose.
Here are a few scenarios where your businesses could benefit from cyber liability or data breach insurance:
Your business has a computer network that allows all your employees access to the saved, which is helpful but also puts the entire operation at risk should a computer virus work its way in.
The business keeps customer/patient records such as medical histories, credit card, bank account and social security numbers in its database – which is a target for hackers.
This hidden danger is lurking around your business every time you log onto your network. Data Breach / Cyber Liability coverage is available to help cover legal defense and liability expenses if your business is sued because of a breach.
Employment Practices Liability Insurance (Why can’t he take a joke? I didn’t mean anything by it?)
What’s the big deal about these examples? They could put you out of business.
The costs associated with employment practice-related claims can absolutely boggle the mind and are on the rise. Employers may face a number of claims and lawsuits over wrongful termination, discrimination, workplace harassment and retaliation. And a business owner doesn’t even have to be in the wrong to be sued. The right insurance to cover defense costs and financial damages related to employment-related claims can be critically important to help protect business assets.
One bad joke, a disgruntled former/current employee or hurt feelings could be a claim waiting to happen.
Business Flood Insurance (Who in the world needs that? My business isn’t in a flood zone.)
Many years ago there was a terrible tornado spree that swept through North Carolina. The storm did awesome damage to many businesses and homes. Many of which were my clients.
Due to the catastrophe, FEMA stopped by my office do discuss the situation and to obtain on the ground information. The FEMA spokesperson asked me if Flood Insurance was something that I sold to my business clients. I told him that most of our clients were not in a High Risk Flood Zone. His response was priceless because it impacted my thinking about this often overlooked coverage.
He asked “does it rain where your clients are?” This simple question makes all the difference in the world when it comes to protecting your business from one of the most overlook and neglected hazards.
If your business property is located in an area where it rains, I highly recommend adding a commercial flood insurance policy to your program. Even if you live in an area that doesn’t flood, you’ll need a policy if it rains where you operate your business
Choosing the right Insurance Agent and Company is good business
Eye doctors are really good at working on your eyes. Dentists are really good at working on your teeth. But an Eye doctor would probably be a bad choice to perform your root canal.
That’s why choosing a Specialty Insurance Agent for your professional office just means smart business.
Many insurance companies specialize in Professional Office Insurance. On the other hand many insurance companies don’t. Finding the ones that can offer you the coverage you need at a fair price is a task that should be left to a Specialized Agent.
I think one of the biggest problems that many Business Owners face is not having adequate insurance coverage. Using a Specialty Agent as a tool to help you navigate through the maze of insurance issues can be your best tool in your tool box.
As you’ve read through the different pitfalls and obstacles that I’ve been presented here, you’re probably questioning your current policy coverage, your current agent’s expertise, and your current insurance company’s business program. If so, I’ve done my job. Now it’s up to you to make sure that you’re covered like you deserve to be.
“It’s your business first but once you’re my client, it’s my business to make sure you’re offered the insurance coverage you need and want.”