Income Protection NZ Articles

The need for a business insurance starts the moment one initiates the business idea and plan. That is why it very important to have the detailed idea as to what business insurance is and what are its dos and don'ts.

Here are some of the initial tips that may help you to get your proper insurance for your business and might also lower the risks and losses of your business.

The Dos:

1) Do find an insurance adviser who has an understanding of and experience in the type of your business you are in.

2) Do make sure that your business insurance covers all the basic coverage such as

- Property insurance along with the equipment breakdown.

- General liability coverage with product liability insurance

- Commercial auto insurance

- Workers compensation insurance

- Professional liability insurance

3) Do keep your entire inventory in a safe place, off premises. Also try to include the photographs of your property and your inventory lists. These documentations help while you need to report a claim.

4) Do check the financial condition of the company before buying the business insurance policy. You should also keep in consideration, the insurer's reputation and integrity. You should have the solid idea of the insurer's historical background.

-Do protect your business with more than just liability insurance.

 --Employment practices liability insurance

 --Professional liability insurance

 --Directors and officers liability insurance.

The don'ts:

1) Don't try to underinsure to get a reduced premium. You cannot skip this, as you have to pay later. A lower limit on your business insurance will give less financial protection when a loss occurs.

2) Don't overlook the policy's "exclusions." It is just as important to know the coverage. Your business insurance adviser might help you by providing the list of standard exclusions.

3) Don't assume that theft coverage will extend to the personal property, tools or equipment used by the employees or customers' goods. For this make sure that you business insurance policy includes the provision for these.

4) Don't skimp on errors and omissions coverage if your business needs it. Though the claims are few in number, they are often huge in impact. Just one professional liability lawsuit can wipe out an entire business.

5) Don't just focus on reducing the cost of your business insurance. Also look for ways to reduce the likelihood of losses. Your renewal insurance premiums will typically be based on your loss history. So the best ways to control your ongoing costs is to limit your yearly losses.

6) Don't hide or misrepresent unusual risks from your business insurance advisor. Sometimes a failure on your part to disclose a risk can result in a denial on the part of the insurance company to cover a loss. Better to know you're protected now, than find out later you're not.

These are just the preliminary dos and don'ts for business insurance. You need to consult a professional if you want to get the best of these policies.