EXTRA COVERAGE YOU SHOULD BE AWARE OF
Special policies can cover the risks unique to your business.
This form of insurance provides you with the funds required to protect your business' financial position if your operations are interrupted by an insured loss such as a fire. Features and costs will vary considerably depending on whether you insure for named perils, a specific timeframe, specific costs or just a portion of the income you lose. This form of insurance is highly customizable and can include coverage for extra business expenses, rental income lost, gross earnings lost, payroll and professional fees.
A consequential loss is not caused directly by damage to property but is a consequence of other damage. For example, a cold storage facility might experience significant inventory losses if an on-site transformer station failure cuts out electricity supply or a fire damages the refrigerators. A greenhouse operation or a winery might require constant temperature and humidity to be maintained and would insure against the consequences of an extreme change in those factors.
Many named perils and broad commercial-property insurance policies will exclude coverage of damage to or breakdown of highly sensitive or specialized equipment, including high-pressure boilers, control systems and computers, diagnostic equipment and more. Special machinery policies can be obtained to cover equipment for sudden and accidental breakdown, which is advisable if loss of use is a significant risk for your business.
Errors and omissions and director's and officer's liability
It is common practice to protect company directors and senior managers from personal liability for actions that are the responsibility of the company they direct. While insurance does not remove their fiduciary duty, it does provide some financial protection from legal liability for a claim made against them for an alleged or wrongful act. A wrongful act is any error, misstatement, misleading statement, act of omission, breach of duty or neglect allegedly committed or attempted.
Errors and omissions insurance is usually used in professional services firms, such as law, accounting and consulting, to protect professional staff from the impact of errors and omissions in their work.
There are as many forms of specialized coverage as there are risks to your business. A broker can help you assess the probability of experiencing a loss and determine whether or not you should purchase specialized coverage. Talk to us to see if there are risks unique to your business that require extra protection.
REDUCING THE RISK IN YOUR BUSINESS
A risk management program is the best way to systematically reduce the impact of risk. An experienced commercial broker knows how to identify and manage many of the risk factors in your business and translate that knowledge into a cost-effective risk management program. There are four key steps:
1. Know your risk exposures
The first step is to accurately identify and analyze the risk exposures to your tangible and intangible property and your income, personnel and liabilities. These can be determined in a thorough audit of your office, warehouse or shop floor to identify all perils, probabilities and potential financial consequences.
2. Consider the risk management alternatives
Insurance is one form of "financing" your risk, but there are other alternatives to explore. These include eliminating the exposure, loss prevention, loss reduction and contractual transfer of responsibility for losses, for example, when a lessee assumes the liability for damages to leased space. A thorough risk management plan will examine all these alternatives before getting to the issue of insurance.
Commercial insurance is the most widely used of all risk financing techniques because of the cost-effective protection it provides. General and specialized policies can cover just about any peril. Another way to manage risk is to be financially prepared for a loss. One way to do this is to accumulate your own capital reserves to cover the loss, but this can tie up large amounts of capital at low rates of return.
3. Implement your plan
With loss prevention and reduction plans in place, we can help you implement your insurance program with one or multiple insurers.
4. Monitor and adapt your plan
Make sure to adapt your plan to match the changes in your business, including geographical expansion, physical growth, new lines of business or increased complexity. Consider an annual review of your needs with our help.
Owning rental property is a major investment and involves more risks than simply buying a home to live in yourself. That's why you need landlord's insurance to protect your investment. There are several kinds of coverage to consider for your rental property.
Liability (third party liability)
You may not be responsible for your tenants' belongings in case of theft, fire, or other damage, but you are liable for whatever happens to your tenants on your property. Liability insurance protects you against major financial loss should your tenant sue you for a fall, wrongful eviction, or other types of lawsuit claims. The case for physical injury applies if you haven't taken reasonable precautions to ensure safety, such as regular maintenance, upgrades, or posting warning against perils that you can't address.
This form of coverage protects you against property damage from risks such as fire, floods, burst pipes, etc.
Separate and distinct from building insurance, contents coverage insures you against losses as a result of damage to your furniture (if it's a furnished unit), walls, flooring, fixtures, appliances, and heating/cooling systems. The more contents coverage you want, the more it will cost, so prioritize what is most important.
Loss of rent
This insurance compensate you for any loss of rent if your tenant breaks their lease, refuses to pay rent, or you evict them. Your policy will cover you for a certain period, so find out your coverage limits.
The farther you are from your rental property, the tougher it is to keep tabs on it. So when things go wrong in your absence, such as an electrical fire or a burst pipe, emergency coverage will help to lessen the impact of costs associated with these unforeseen and potentially costly repairs.
Legal expenses insurance
Another layer of protection for landlords is coverage legal expenses, which you can incur while attempting to recover legally owed costs by tenants, such as rent, payment for damage, or the cost for you to legally evict them.
Illegal activity on your property
The first step in protecting your investment property is to carefully screen and monitor tenants, such as requesting their social insurance number and checking references beforehand. You can also protect yourself by insisting on tenant's insurance, requesting a damage deposit, and insist on cheque payments only. While renting the property, conduct periodic checks on the rental unit.
BUSINESS INTERRUPTION POLICIES
There's the cost of doing business, and then there's the cost of not doing business. When something disrupts business as usual, such as theft, vandalism, a fire, or water damage, the role of business interruption insurance is stepping in to protect against income or profit loss until you can resume business.
Making it part of your business insurance plan
Generally, business interruption is included in some form in business insurance policies, but not always. Talk to your broker and ensure that you have it. Keep in mind that property insurance only covers loss or damage related to the physical structure and its contents. But business interruption insurance will cover any costs incurred as a result of any repairs required or continued fixed costs.
Picking the right terms
There are two ways you can go with interruption insurance - it can be based on lost earnings or profits. Basing it on profits has its advantages in that coverage continues until your business returns to a state of profitability; usually, it lasts a 12-month term but it can be extended. The earnings option means that coverage stops as soon as business activity resumes.
The cost of temporary relocation
The cost of doing business elsewhere if you have to operate from a temporary location. This would include the cost of moving to another location.
An insurer may also cover additional expenditures that a business may choose to incur in order to keep the business running as opposed to closing it and losing income.
SAVE MONEY ON BUSINESS INSURANCE
Business owners have likely noticed the soaring costs of insurance premiums in recent years. But since protecting your business and livelihood is a necessity, you need to look for creative ways to reduce insurance costs.
Prioritizing your top business needs
Insurance policies contain need-to-have clauses and nice-to-have ones. With the help of your broker, your task is to sift through the terms of your policy to establish what's a must and what you can maybe do without. For example, one way you can cut costs is by raising your deductible to lower your premiums.
Getting the right coverage
The key thing to consider is that you maintain adequate coverage for losses. You don't want to increase your risks for the sake of cutting costs. An insurance broker can guide you in finding an insurance plan that includes everything your business needs, such as product liability, disability insurance, or professional liability insurance.
Taking advantage of group plans
Group plans through professional organizations and local chambers of commerce can offer members discounted rates. Just remember to factor in the cost of joining and annual dues.
Bundling your insurance plans
Talk to your broker about finding a company that can offer you a multiple policy plan that combines different kinds of business insurance, such as property, liability, loss of income, etc. You save money by paying one premium instead of several.
Lowering your liability risk
Anything you can do to make your business a safer prospect can help to reduce your insurance premiums. It could range from upgrading your security system and installing surveillance cameras to adding safety measures for employees.
Shop for the best deal
Your broker can help you review your current policy, then shop around for better rates. A broker can help you get several quotes to find the best deal for you. You may not end up changing insurers, but it never hurts to look.