Commercial Insurance Renewal Checklist
To ensure that your business has adequate insurance coverage, don't skip an annual review of your commercial insurance policies.
An annual review of commercial insurance policies can be time-consuming for small business owners, making it tempting to automatically renew existing policies. However, if their business has changed over the past year, they run the risk of being underinsured or potentially overpaying for coverage.
It's important for commercial insurance coverage to meet a company’s evolving needs. The business insurance renewal process provides the perfect opportunity for business owners to work with their insurance agent to determine if current policies are still providing the necessary protection and if they might qualify for discounts.
Get a head start on business insurance renewal
Business owners should start preparing for the insurance renewal process a few weeks, or even months, before the renewal deadline. This provides the necessary time to gather financial information that insurance carriers need to determine what, if any, policy adjustments need to be made.
Questions to answer before renewing your business insurance
To prepare for insurance renewal, business owners should be prepared to answer the following questions:
Have you moved to a new location?
Moving from a home office to a commercial space, expanding to a new location, or opening an additional office could all trigger the need for changes to general liability insurance or a business owner's policy. In some cases, insurance rates may actually go down – especially if the new location is smaller and includes enhanced safety features, such as a wired alarm system or sprinklers.
Has your number of employees changed?
Staff changes could require updates to your workers' compensation insurance policy. Every state has different rules, but the majority require employers to purchase coverage as soon as the first employee is hired.
As employees join or leave the company, workers’ comp coverage levels should be adjusted. This ensures all employees are covered and business owners aren’t paying for staff members who are no longer with the company. The insurance renewal process is the perfect opportunity for business owners to verify they are carrying appropriate workers’ comp coverage.
Are you offering new goods or services?
Changes in service offerings may require adjustments to professional liability insurance coverage, and businesses that update product lines should revisit the product liability coverage in their general liability policy.
The renewal period is also a good time to verify if you have cyber liability coverage, which can protect small business owners from the financial fallout of a data breach. This coverage is often included in professional liability or general liability policies. It can also be purchased as a standalone policy.
Did you purchase new business equipment?
The rates for commercial property insurance, which can be purchased separately or as part of a business owner's policy, are based on the type and amount of equipment a business owns. Significant changes to the value of the business property could impact your annual premium.
Have your business practices changed significantly?
If your business practices have changed significantly, you may need to adjust certain policies, such as general liability insurance, or add new ones, such as commercial auto insurance, to ensure the business is protected from additional risks.
Did you purchase or sell commercial vehicles?
Businesses that bought or sold a business vehicle will need to adjust their commercial auto insurance coverage if they haven’t already done so. In addition, businesses may need to add hired and non-owned auto insurance if employees use personal vehicles for business purposes. Personal auto insurance policies typically don’t cover work-related driving. A change to the company’s travel radius could also trigger an increase or decrease in coverage need.