When to Update Your Insurance Policies
When you’re growing a business, it’s important to recognize that your insurance needs are not stagnant. As you go through changes, your insurance policies need to evolve to keep up with those changes. While we understand that competing priorities can be difficult to juggle, it’s important to see the entire picture that extends beyond the big project in front of you.
Here are a few times you need to update your insurance policy:
Purchasing new equipment: Your tools and equipment need to be listed or else they won’t be covered when it comes time to file a claim. Inland Marine Insurance protects your tools while they are in transit while Property Insurance covers your tools when they’re at the job site. If you forget to list heavy machinery, your project could be delayed for who knows how long while you procure the money needed to replace or repair.
Relocating your office: The square footage, security features, and location of your office affect the final value of your property insurance premium. If you move your office, the property policy needs to either cover the building (if you own it) or your contents (if you rent it). Failure to keep your policy up-to-date means your coverage will be inadequate or you won’t have any at all if something happens.
New service offerings: Your insurance company should know all the services your business provides. This is because not all services may be covered by the standard policy. Endorsements are used to cover services that are not included. H&K Insurance can advise you on the endorsements you may need for your business.
Changes in revenue: Your premium coincides with your income. If you income doubles or takes a nose dive, you need to structure your policy around those numbers. Some contractors may want to receive cash under the table to avoid paying taxes. We called this “hidden income” and it’s a big no-no. If a fire engulfed a job site, you would be compensated for the lost revenue under your business income interruption policy. To do this, the claims adjuster looks at your financial records to come up with the number you’re owed. If these records have holes, you’ll see a lower number than you might expect.
Hiring employees: The construction industry is one of the most hazardous out there for slip-and-fall accidents. Failure to report how many employees you have causes a lack of coverage at worst and an inflated premium at best. Improper classification is a common mistake where all employees, regardless of work function, are under the same code on the insurance policy. The risk for the office personnel vs construction workers is drastically different!
Did you miss a box on your insurance checklist? Give John Quinn at H&K Insurance a call at 617-612-6533.
