By Hannah Corbett
For any business – no matter the size, and no matter the industry – insurance is an essential tool for financial security and ensuring future growth. But of course, comprehensive insurance does not come without its price, and cost is something that’s always at the forefront of any business owner’s mind.
Business insurance is one of those things that you just have to bite the bullet and pay for. However, that doesn’t mean that it has to completely break your bank account. There are certain ways in which it is possible to reduce your business insurance premium, saving you money to better invest elsewhere.
The Cost of Business Insurance
There are many elements that can influence how much a business insurance policy costs, including:
- The size of your business
- The number of employees you have
- How experienced your staff are
- The nature of the products you deal with, or services you provide
- The extent of cover you require
All in all, the more risk you present to an insurer, the more you will pay for insurance. So, in order to reduce the cost of your policies, you must reduce that level of risk.
Reduce Your Risk
Essentially, you have to make your business appear very unlikely to make a claim – meaning it’s unlikely the insurer will have to pay you anything. There are a number of ways in which you can do this, by increasing security and safety standards.
Locks on Entrances
If you haven’t got locks on all doors and windows of your business premises – install them. If you haven’t got very good ones, or if they are quite old – get new ones. This can help to reduce the cost of policies such as buildings and contents insurance, as it makes it less likely that someone will be able to break in and steal or cause damage to your property.
Again, if you don’t have a good alarm system, then you should seriously consider purchasing one. It’s quite common for insurers to knock down policy prices due to addition of a security alarm. It may be an upfront cost, but it has the potential to save you money for year to come.
Educate Your Staff
Making your staff more aware of health and safety in the workplace reduces the risk of them injuring themselves, which can lessen the price of employers’ liability insurance – a policy you may be legally required to have in place. You can take steps such as clearly displaying health and safety procedures at work, putting your staff through safety training courses, and appointing designated first aiders.
Reducing the amount of risk you present to an insurer – by following the above suggestions – is a great way to help to slash premiums. But, there are also a few more ways that you can cut the cost of business insurance, such as:
- Get the right cover – make sure you conduct a thorough risk assessment and fully understand each policy and what it protects against. This way, you can ensure that you’re not unnecessarily paying for cover that you may not need.
- Don’t estimate – it may not be possible to give exact numbers when getting quotes for cover such as stock insurance, but make the effort to make an educated guess and get as close as you possibly can. Underinsuring can leave you in a very vulnerable situation should disaster strike.
- Shop around – don’t just settle for the first insurance quote you get. Use a comparison site, or call around a few different insurers, and see who can give you the best quote. You may be surprised at how much you can save with a little bit of legwork.
Business insurance can easily be expensive, but unfortunately it is an essential element of any business and should not be neglected. While it will always be a cost to any business owner, there are steps you can take to try and minimise that cost. Try following some, or all, of the above steps to see if you could significantly reduce the cost of your business insurance premium.