Learn How To Select Insurance Plans Using Needs Analysis

Knowing how much insurance you will need as a small business owner can be a challenging endeavor. Nevertheless, having the appropriate insurance policy can save a small business a lot of money.

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Evaluating Your Business

The first consideration when using needs analysis for deciding on an insurance policy for your small business consists of accurately analyzing the different liabilities and assets which directly affect the business. These include:

• Property – this includes equipment, real estate and other assets.
• Business Volume – the amount of accounts receivable and the average cash flow of the business.
• Salaries – how much you pay yourself and however many employees the company has.
• Overhead – the cost of running the business including rent, utilities and other miscellaneous expenses.
• Future Trends and the Local Economy – how future trends and the state of the local economy will affect the business in the future.

You can then better determine your company’s insurance objectives and what type of insurance plan would be optimal for your business by keeping the above factors in mind.

Getting the Right Amount of Insurance

Once you have evaluated your assets and liabilities, you will be much better prepared to determine how much insurance your company will need. You will want adequate coverage for your assets so make an accurate assessment of potential risks to your property to get adequate coverage.

By law, your business will need Workers’ Compensation insurance. Consult with your company’s lawyer or advisor on how much your company may need and what type of package would be optimal for you and your employees.

Choose a Reliable Carrier

A reliable insurance company and an experienced agent can be an important element to obtaining the right amount of insurance for your business. A knowledgeable agent can help you perform your needs analysis, and can sometimes speed up the claim process, if you need to make one.

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