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July 6, 2013

What does it cost to Insure my Small Business

July 4th 2013,

I & E Insurance Agency 2900 Route 88 Point Pleasant NJ 08742


What should it cost to insure my small Business and why do I need it?

Before you can even get a quote on the cost of your insurance you need to look at your business, and make several determinations, ask questions and then come up with solutions to solve the problems identified. Your business insurance costs will differ depending on what kind of business you own as well as what company you pick. While the market for your insurance may be competitive, certain Insurance companies can specialize in a particular industry and therefore the costs can vary. Generally you will need insurance for property, liability and workers compensation. And the costs can vary depending on a variety of factors.

1)                First find an agent you feel comfortable, it isn’t always just about price; like anything else, a doctor, a contractor, a mechanic, you want someone that can help solve a problem at a competitive price, but one who is looking out for your interests and understands your problem. So discuss your Business insurance needs. How are you vulnerable to a potential loss in your business? Commercial general liability (CGL) policies generally protect against bodily injury, property damage or loss, personal injury and advertising injury. And you may have specific needs for a specific situation. Your agent should address these concerns as they discuss and view your business. Not every company may give you a quote; certain insurance companies specialize in particular industries, so a company that can insure a carpenter, may not insure a doctors office. So get as many quotes on commercial general liability insurance as you can. Make sure you’re making an apples-to-apples comparison of policies. Don’t forget Read through the policy completely. Do not assume that all situations are covered. Discuss what-if scenarios with your agent to examine your coverage needs.

2)                Thereafter discuss the payment plan, some companies allow monthly payments or quarterly payments. Keep good payroll records, as you will most likely be subject to a yearly audit of your payroll expenses and amounts that you paid out to any subcontractors. Additionally you policy may have been priced according to your sales, thus if your sales were higher after your audit you could be assessed extra charges. And if your payroll was higher than you estimated, your workers compensation and general liability premiums will be revised.


3)                Now once your business is operating, make sure you get certificates of insurance from all your subcontractors. If your subcontractors fail to show proof of insurance to you, then the amounts you paid to them may be added to your total payroll, thereby increasing your insurance costs. Discuss adequate coverage for subcontractors with your agent. And pay close attention to the workers compensation rules. Failure to cover an employee can cost you a small fortune if disaster strikes and you didn’t have the proper coverage. State Fines in NJ can run upwards to $5000 per day.


4)                Know and understand your risks. If anything was learned from Hurricane Sandy last year is that most small business didn’t understand their policies. Unfortunately most concerns were about   price and not coverage. Thus when the power went down for days and into weeks, stores lost inventory, sales were lost, customers were unable to spend. The right policy may have provided coverage for lost sales, lost inventory, and lost income. And don’t forget flood Insurance. General Liability and Property Insurance do not cover any damages or losses due to floods. Make sure you get the coverage you expect for all potential risks that can arise, talk with your Independent Insurance agent and get the answers to your questions.

5)              Commercial Auto Insurance: If you operate a business and use a vechicle you should have a commercial auto insurance policy especially if your business name is displayed on your vechicle. If you use your personal auto in your business and have an accident is quite possible that your personal auto policy could deny any coverage in the event of accident.  For many small business owners, knowing what coverage is proper can be a daunting task. For instance over six million traffic accidents occur every year, or more than 16,000 per day. With accidents almost commonplace make sure you have the proper coverage  that will cover you in a claim. Whether you use your own car or  have a commercial fleet, of cars, pickups or trucks, the proper covergae can provide you peace of mind when adversity occurs. Your Independent agent at    can get you the protection you need – including liability, personal injury/medical coverage, comprehensive, collision coverages, and much more to help you keep your business safe solid and moving ahead.

Another consideration if your employees use their own autos to perform deliveries, meetings, sales visits, picking up supplies, and other errands for your business? If so, you could be held liable for any accidents they cause. Make sure you understand the risks from that action.

In summing up, there are no easy answers to what a typical policy costs, and a commercial policy for your business can’t be bought as easily over the internet as term life insurance. There are so many variables that can occur and the cheapest policies may end up costing you more in the long run, that’s why it important to get competent advice and service from your independent insurance agent.. For more information call us at 732-899-8177 or visit us at

This web site may contain concepts that have legal, accounting and tax implications. It is not intended to provide legal, accounting or tax advice.

You may wish to consult a competent attorney, tax advisor, accountant, or your own financial advisor. EMC Insurance Agency & Financial Services LLC dba I & E Insurance Agency & Financial Services is an Independent Insurance Agency, a Member of the Trusted Choice, Independent Agents of America & PIA contact your own advisors before making any financial decision. Services offered through independent NON-AFFILIATED ENTITIES

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