Typically, business insurance policies cover a company or professional for around one year. Quality insurance is customised specifically for the insurance owner to help avoid risks in their industry. After a successful year, it’s time to start renewing your business insurance and analyse what has changed.
Every year things change for better or worse, and your insurance likewise must be changed. The primary purpose of business insurances is to help you when things go wrong financially. Therefore, when a business develops, you must adjust your policy when renewing your business insurance.
As the original insurance may not cover your new risks, and in this case, your business will be in trouble. The short article will explain the updates you must check when renewing your business insurance.
Updates To Note When Renewing Your Business Insurance
The main purpose of starting a business is to grow, gain profit and have a successful brand image. The measurable growth includes an increase in clients, income, goals and an expansion to new locations. Business growth is crucial and happens over time, but as the business grows, so do its risks.
The positive growth should be communicated to the insurers when renewing your business insurance. The information will help them recalculate your business risks and create a better policy. The premium may increase, but it will be worth it when faced with any possible risks.
You must also inform your insurer if your business has been downgraded. For example, in case you have closed down locations and lost clients. You do not want to pay a high premium for threats you may not be facing anymore.
Change In the Number of Employees
Over the year, the number of employees you hire or lose may change drastically. Each business is responsible for every single employee and if they suffer any work injuries. Employee compensation insurance calculates depending on the total payroll and helps cover work injury risks.
Therefore, if you have or have plans to hire more employees in the upcoming year – you must inform the insurance company of the new payroll and their duties. Different duties have different risks and different insurance coverage.
However, in Hong Kong, the insurance will cover new employees and charge you the difference at the end of the year. The insurance company will just need to know the total payroll when renewing your business insurance.
New Business Assets
What is the value of your business assets? Depending on your business, your assets may involve material, machinery, vehicles, and expensive valuables.
Business assets must be protected by insurance such as property all-risk or machinery breakdown insurance. The insurance will cover the cost of repair and replacements of breakdowns and damage to assets.
The insurance will cover only the business possessions registered under the original policy. If you have purchased more assets or opened new locations, you need to increase your coverage when renewing your business insurance.
The increase in coverage will assist the business during expensive breakdowns or property damage and is crucial when growing the business.
New Products or Services
Opportunities can arise at any point in a business life cycle. When starting a business, you may not know what products or services you may add to your original business plan. Over the years, you may expand your product line or provide more services. Each product and service has risks, from product defects to negligence lawsuits.
Businesses providing products and services need a product and professional liability insurance. Hence when planning or introducing new products and services, your business must update its policy when renewing your business insurance.
Claims regarding products and services can arise anytime, and the insurance must be updated/renewed to provide the best coverage.
Use of New Technology and Software
Most businesses use advanced technology and software as a big part of their business. The more technology you use connected to the internet, the higher the chance of cyber-attacks. You should already have cyber insurance to cover and protect your business and data from cyber threats.
Therefore, when renewing your cyber insurance, you must ensure that the updated policy covers all the new technology, devices, and software. For example, your current cyber insurance may not cover a hack through the new software your business has just started using.
Additionally, as you increase your staff, more laptops are added to the business, and the renewed cyber insurance should protect each device.
Why Renewing Your Business Insurance Is Crucial?
When renewing your business insurance – you must inform your insurer about any changes in your business activities, property, staff, and future plans. This communication will allow you to update your coverage to meet your new business needs.
The best time for renewing your business insurance is 60-90 days before your current insurance expires. The duration gives your insurance company enough time to use the new changes to customise a more accurate policy.
Updating when renewing your business insurance can save you significant financial loss and protection from future risks.
It’s time to check your current insurance policy, is it expiring soon? – list your company changes and renew your insurance now.