Starting from the bare basics
As a business owner in the Ontario region, you have probably already discovered that law requires you to purchase several forms of insurance, before you are even allowed to open your doors. With that being said, owning and operating a new business can be exciting, but depending on the type of business that you are getting into, you could be considered high risk by insurance providers. It doesn’t take an expert to realize that this is going to raise your commercial general liability insurance premiums. Not to mention, if you can even get insured at all. So, what exactly can you do about this, and are there any other factors that make providers consider you high risk? Below, you will learn some informational tips that will help you when, it comes to applying for high-risk business insurance.
What Makes You A High Risk Business
Every business out there comes backed with some risks. Unfortunately, that is just the way the world operates. However, you might be surprised to learn that 60 percent of businesses come with more inherent risks that other businesses. This basically means that there is a 60 percent chance that your insurance premiums will be higher than the other 40 percent of the Ontario businesses. So, what is it that exactly makes your business high-risk? Well, there are a variety of different factors that companies like Ontario business insurance in Canada consider when determining if a company is high-risk or not.
Industry Choice – It is true that some industries are destined to fail. For instance, around 50 percent of restaurants fail rather quickly, because they can’t make themselves stand out amongst the competition. Due to these facts, insurance providers consider the restaurant business high-risk.
First Time Business Owners – Everyone has to start somewhere, but unfortunately first time business owners are always considered high-risk. If you have a partner that has ran a business before, it might be best to get him or her to apply for the insurance, in order to lower your premiums.
High Claims Frequency – If you already have some previous policies with another insurers and have had several claims filed against you, this can make you a high-risk business.
High Crime Area – It might not seem fair, but depending on the location of your business you could also be considered high-risk. For instance, if you live in an area, where the crime is extremely high, or an area that it prone to flooding, most insurance providers could consider you high-risk.
Large Number Of Employees – More employees might make you more productive, but with employees there is a greater chance of one of them filing a claim, or doing something that results in a claim. Unfortunately, with more employees you are going to be considered higher risk by insurance providers.
How To Get Lower Premiums
Now, that you know how and why providers consider you a high-risk business, you are probably wondering what you can do to get you premiums lowered. Luckily for you and your business, there are a variety of techniques that you can implement to ensure that you are getting the lowest premiums possible.
Adopt And Enforce Safety Procedures
Adopting and implementing safety plans amongst your employees can eliminate hazards that lead to injuries, accidents, and lawsuits. In fact, if you host weekly or monthly safety inspection and classes, it is possible that your insurance provider will take this is to account, when considering your premiums. However, just teaching about safety practices will not do any good unless you go to the extra lengths and make sure your employees are sticking to the all the safety procedures on a daily basis. Perform surprise inspections, and show up on jobs to make sure your employees are following the rules.
Eliminating High Risk Employees
If you are a large business, there is a good chance that you experience a high rate of turnover in employees. Before applying for a policy, or even if you have a current policy active, always make sure that you are reviewing your lists of employees and keeping it up-to-date. It is possible that you once had a high-risk employee with a bad driving record that no longer works for you. By informing your provider of these changes, you can go a long way in reducing your auto premiums.
However, if the individual still works for you it might be a good idea to consider banning their driving privileges or making them take driving classes. All of these actions can help reduce the amount of auto insurance you have pay on this individual.
Staying Up-To-Date With Your Coverage
As you already know businesses change from time to time. In fact, it is highly likely that your business has policies implemented that are no longer in use. For instance, you might have commercial property coverage for a high-risk building that you no longer own. Make sure that you are keeping track of all of your policies and keeping them up-to-date.