Originally created 10/12/03

Insurance can be business owner's salvation



If you haven't read your insurance policy lately, or ever, it's time to dust it off and really read the fine print. There are gems hidden inside there that could make or break your business if the unexpected strikes.

If you are one of those people who thinks disasters happen only to the other guy, consider this:

  • Sending anyone on an errand for your business in their car could put you at risk for damages if that person has an accident.
  • If you have a loss of cash, securities or inventory and there is some basis that employees are involved, your claim might be denied.
  • Your risk of being disabled for an extended period of time is greater than your risk of dying. Could your business survive 90 or more days without you?
  • So, as a new or current business owner, what are the top areas you should consider insuring? The answer depends on your business and the types of products or services you sell.

    However, some basics include liability coverage, property/physical damage insurance, crime insurance, bonds and employee group insurance.

    To find an agent, get a referral from someone in a similar business whose opinion you trust. Try to get at least two or three names so that you can interview each candidate to determine the best fit for you and your business.

    When structuring your interview, be sure to consider the size, complexity and maturity of your business and how it fits with the typical clients of each agent. Don't forget to ask your prospective agents whether they have professional liability insurance. If they don't and they make a mistake, you could be worse off than you would have been without any insurance.

    Aside from purchasing a policy from an agent directly, you might want to consider trade groups and professional employer organization purchasing plans. Being a member of some of the larger organizations sometimes can result in sharply reduced insurance rates.

    Finally, consider purchasing all, or at least most, of your insurance through one agent rather than one policy here and another there. It makes it easier to determine whether your coverage is complete and helps eliminate the possibility of duplicate coverage.

    Remember, the type and scope of the insurance you carry can make or break your business if the unexpected happens, so take the time to understand the coverage you have and never sign anything before you read it completely.

    Patricia Stallworth is a business consultant with the Georgia Small Business Development Center Network. To reach the Augusta office, call 737-1790.