General liability insurance planning is a critical but often overlooked part of strategic business planning and especially, new business planning. There are a number of steps to take to insure you get the most coverage for your premium dollar.
Here are a key areas to look at and sources of information to help you in your insurance planning:
Contact the North Carolina Department of Insurance. They have information available on types of insurances, requirements specific to certain businesses, and numerous other resources. They can also give you accurate general liability insurance quotes. Here is a link to their consumer and business page: http://www.ncdoi.com/Consumer/
Contact any industry associations. They too may be able to provide resources and may even have group purchasing plans available. They also may have information on types of insurance coverage, various configurations of general liability insurance, and recommended limits.
Try to assess the risks your particular small business may be exposed to in the daily operation of the business. Risk elements to be considered are location. Try and find out the crime rates and vandalism rates. The type of building structure your business is located in. What is the distance for fire and ambulance to travel? Police? What is the layout of the business structure? Stairs, elevators, equipment lay out? As you can begin to see, the various elements of risk determine what a premium will be and coverage limits the carrier is willing to give your business.
If your business has or will have employees, what risks may they face in the operation of the business? Here again, the state department of insurance can help. The workers compensation act is covered by the North Carolina Industrial Commission. You can find more at the official site for the state of North Carolina's insurance section.
Choose a licensed insurance professional you are comfortable with and is willing to work with you. Whether you pick and agent or broker, take the time to interview them. Make sure they are willing to meet with you periodically either in person or over the phone. Industry experience is nice, but look for a solid knowledge of business principles. Check references, ask questions, find someone you are comfortable making a trusted advisor to your business.
Utilizing these steps will help you as a business owner understand the risks involved in owning and operating a business. Risk management is often not talked about until a business reaches a certain size. Many businesses don’t reach that level because of not understanding what risk management is and how it could affect the growth and financial security of your business.
Once you have chosen your licensed professional, engage them to help you develop a risk management strategy and review that strategy at least annually.