What Are the Top 5 Small Business Insurance Claims?

Most small business owners skip paying for small business insurance until they have a legal or contractual reason to do so. But, in doing that, many are putting themselves, and their business, at risk. According to a commercial insurance study conducted by The Hartford between 2010 and 2014, 40 percent of small businesses will experience an event that requires them to file a small business insurance claim in the next 10 years.

Here are the top five claims filed by small businesses:

Theft: Not surprisingly, theft topped the list of small business claims on The Hartford’s list. Twenty percent of all claims filed by small business owners were due to theft and burglary.
The average loss for theft claims was around $8,000.

Water Damage: Coming in second was water damage. Fifteen percent of the small business claims in The Hartford’s study were caused by flooding from frozen pipes that ended up bursting as well as collapsed or damaged roofs from snow and ice accumulation.
The average loss for water damage claims was $17,000.

Wind and Hail Damage: Another 15 percent of small business insurance claims resulted from wind and hail damage.
The average loss for wind and hail damage claims was $26,000.

Fire: Ten percent of the claims filed by small businesses in The Hartford’s study was due to fire. With the significant damage that fire causes, it’s no surprise that fire claims are the most costly on this list.
The average loss for fire damage claims was $35,000.

Customer Injury: Slip-and-fall customer accidents also accounted for 10 percent of the claims in The Hartford study.  
The average loss for customer injury claims was $30,000.

If you own a small business but don’t have small business insurance, think about the impact one of these incidents would have on your small business. You owe it to yourself, your customers, and your business to at least get a quote to see how affordable coverage can be. Talk to your insurance broker today to explore your options.

5 Ways To Protect Your Business From Liability Insurance Claims

Accidents happen. That’s why you have liability insurance to protect your business from unfortunate incidents like a slip-and-fall accident. Nonetheless, the cost of deductibles and increased premiums that come with repeated liability insurance claims can take an unnecessary financial toll on a small business.

You can prevent the most common types of liability claims before they happen by implementing a safety-first approach. The safety checklist below will help keep your customers and employees safe while keeping your claims costs low.

1. Maintain Proper Lighting
Poor visibility is to blame for a number of workplace hazards including slips and falls. Conduct routine checks of all your interior and exterior light fixtures and immediately replace light bulbs that have burned out.  

2. Clean Up Spills Immediately
Make sure you have procedures in place to handle spills immediately after they occur. Keep a mop and “Wet Floor” sign in an accessible location so employees can readily respond to spills. Also, when it rains or snows, place slip-resistant floor mats at entrances and exits. It’s also smart to put down the “Wet Floor” sign to remind customers and employees to be cautious. 

3. Keep Walkways and Parking Lots Clear
Parking lots and exterior walkways can be costly hazards. Walk these areas at least once a day to check for broken glass or other debris that needs to be removed. If your parking lot develops potholes, deep cracks or other problem areas, it is worth the expense to have them repaired immediately. When snow or ice falls, be prepared to clear it away quickly so customers and employees have a safe path to get to and from your building.

4. Stairs and Steps
Install proper lighting above all stairs to ensure that customers and employees can see clearly. Also, check the handrails to make sure they are not loose. If your stairs do not have handrails, install them 

5. Carpets and Flooring
Heavy foot traffic wreaks havoc on a business’ carpet and flooring. Over time, loose tiles, carpet snags, and other damage can cause tripping hazards. Repair them immediately before they cause a bigger problem.

For more ideas to keep your business free from liability claims, talk to your insurance broker.  

Life Insurance 101: What Type of Life Insurance Do I Need?

If you’re thinking this is one of those articles that asks a question and doesn’t provide an exact answer, you’re right — and there’s a good reason. Life insurance is an individualized product. The type of life insurance you need may differ from the type that fits best for your neighbor, your friends, your parents, or your children.
 
Types of Life Insurance

To learn what type of life insurance you need, it’s important to understand the basics. First, let’s discuss the most common types of life insurance, which fit into to groups:
 
• Term Life Insurance 
• Permanent Life Insurance 

Term Life Insurance
You can think of term life insurance as a life policy with an expiration date. This isn’t entirely true because a term life insurance policy can often continue, but the rates are only guaranteed for the stated term of the policy. After the term is up, your rates can change — and sometimes dramatically. This consideration makes term life insurance a better fit if your life insurance needs are short-term (think decades) as opposed to a policy that lasts for a lifetime.
 
Term policies are often used to cover financial obligations that don’t last forever. A mortgage, or the cost of raising children until they are independent, or both, are common reasons to purchase a term policy. These expenses won’t last forever, so you can often purchase a term life policy that matches the length of your financial obligation and with a death benefit that is close to the amount of money you’ll need for that obligation.
 
Because the rate is only guaranteed for the term you choose, term life insurance often has lower premiums — but only during the guaranteed term. After that, prices can be quite a bit higher.
 
A term life insurance policy has no cash value and isn’t an investment. Some people describe term life insurance as pure life insurance.
 
Permanent Life Insurance
We often think of life insurance as being term life or whole life, but whole life is one of several types of permanent life insurance. Some of the more exotic types of permanent life insurance are well suited to estate planning or as investment vehicles. However, the core permanent life insurance types focus on providing coverage with minimal risk and without an expiration date.
 
Whole Life Insurance: Unlike a term policy that only guarantees a rate for a fixed amount of time, whole life insurance provides a guaranteed premium throughout your lifetime — even as get older or if you become ill. The younger (and healthier) you are when you lock in your rates, the lower your premiums will be even if your health changes later.
 
A whole life insurance policy builds a cash value as well by investing in safe investments. The cash value can increase the amount of the death benefit left for your beneficiaries or it can even be borrowed against. Be sure to speak with your broker or accountant before tapping into the cash value of your whole life policy though.
 
Universal Life Insurance: A universal life policy is often grouped with other permanent life insurance policies because it is designed to last a lifetime. Universal life insurance policies are actually an investment account paired with an annually renewable term life insurance policy.
 
The growth of cash value within a universal life insurance policy can be faster than with whole life insurance, possibly providing a substantially higher amount over decades. However, the premium for the annually renewable term portion of the policy can become pricey in your sunset years.
 
Discuss Your Needs With Your Broker
Because our life insurance needs can vary so much from one person to the next, the best way to approach the topic is to talk to your broker about your specific goals for the policy.
 
Are you filling in the gap from a group life policy from an employer? Are you interested in tax-advantaged estate planning? Are you looking for a way to provide replacement income at any age? The answer to those questions (or others) helps to drive the conversation and determine the type of life insurance you’ll need for you or for your family. Your broker can help you design a complete insurance plan that doesn’t just add a life insurance policy — but considers all of your needs.