With all the time, money, and energy you spend on your business, it’s a pretty good idea to make sure you’ve got some backup. Business insurance is a critical tool for making sure you have the protection you need for your business in case of an emergency. Typically a business will want to get general liability insurance as well as coverage for commercial property, disasters, data breaches, workers’ comp, and a variety of other potential costs.
There are plenty of questions surrounding how to get business insurance, including what type you’ll need, how much you’ll pay, and what you need in order to apply for it. One of the most important things you need to know about your own business is your business credit score, but do you need a business credit score to get business insurance? Not necessarily, but it can help you get a better rate.
What Impacts the Cost of My Policy?
A number of elements will impact the price of your policy, according to Andy Wood, EVP of Retail Operations for Insureon: “A variety of factors affect the types of insurance businesses need and how much they will pay for a policy,” Wood says. “Some of the basics are business type, state, location, revenue and number of employees. The amount of insurance (limits) is a key determinant of cost: the more coverage they want, the more expensive it will be. The value of business property – including real estate, but also equipment and furnishings – impacts how much their business insurance premium will be.”
While a business credit score is not typically required, insurers may ask to access your business data after you apply. Just like with financing applications, having a better business credit score can lower the price of your policy, whereas a worse score can mean you’ll be spending more on business insurance. To know where your score stands, you can check for free with Nav.
What Do I Need Before I Apply?
Preparing to apply for business insurance is a lot like preparing to apply for financing. You’ll need to know certain details about your business. Wood says: “Regardless if business owners apply for insurance online or with a local agent, they will need specific information related to their business operations, revenue and payroll. The amount of information varies significantly depending on the industry.”
If you’re required to have certain coverage before signing a lease or contract, understanding the required coverage will also be key before applying. As with any other application process, doing your due diligence beforehand will save you time and possibly money in the long run.
Part of that due diligence is shopping for an agent. By making sure that you’re working with an agent who understands your business needs and the best options for you, the process can go much smoother. You can likely find an agent who specifies in your specific industry and has expert advice to be of great assistance in the process.
Keep Up With It
It’s always a good idea to take time to revisit your policy over time, especially if you make changes to your business that require new coverage. Experts advise that you search every three years or so for a new policy to make sure you’re not only staying current on your coverage, but getting the best rate.