For small business owners in Toronto who needed any convincing on how the right commercial insurance coverage can future-proof their businesses against unexpected risks, the current COVID-19 global pandemic presents a compelling case study.
According to research by the Broadview-Danforth Business Improvement Area (BIA), as much as 61% of Toronto’s small businesses say they may be forced to close down in the next three months. 76% say they will be out of business in five months.
The majority of the city’s small businesses have struggled to deal with COVID-19’s debilitating economic effects. Many are defaulting on rent and loans, and simply do not see a way to keep the lights on.
Why Small Businesses Need The Protection of Commercial Insurance
The COVID-19 pandemic reflects the kind of uncertainties and risks that small businesses face and have to protect themselves against. Without insurance, many cannot survive sudden property losses, unexpected disruptions, and shocks to their business models.
But how can small businesses, already struggling to turn a profit, make the most of their commercial insurance investment?
Tips On How Small Businesses Can Stretch Their Commercial Insurance Dollars
Commercial insurance protects your business against financial losses caused by destructive events that damage your property, disruptive events that make it hard to operate, as well as from legal liability claims by clients and third parties.
But there are so many types of insurance coverages that small businesses can buy that it quickly gets confusing which ones you must buy for your Toronto-based business. These tips should help:
Have a clear idea of the risks your business faces
The nature of the business you operate determines your risk exposure. Specifically, it provides the clearest picture of the types of risks you face and the types of insurance coverages you need. Depending on your type of business, there are some insurance coverages – like general liability for contractors – that are also mandated by law.
Prioritize buying coverages that are relevant to your business
Commercial insurance isn’t one-size-fits-all. There are some coverages that your business simply does not need. With a clearer picture of the types of risks your business faces, you can more confidently choose the coverages to buy or to add to your commercial property or business owner’s policy.
Depending on your risk exposure, it may be prudent to add specific coverages for property damage and business disruption caused by fire, floods, or other industry or location-specific risks.
Carefully analyze your legal liability exposure
Legal liability claims have the potential to crush and bury your small business if you don’t protect it with the right liability coverage. And the choice of liability coverage you purchase must be informed by the liability threats your business faces.
If you run an online business where you handle customers’ data, it is prudent to buy cyber liability insurance. Likewise, if you are a contractor or your business provides professional services – like architecture, engineering, or accountancy – you absolutely must carry professional liability insurance.
Regularly review your commercial insurance coverages
An undeniable fact of running a business is that the operating environment changes with time, as does your risk exposure as your business grows. Your commercial insurance coverage must adapt to these changing realities.
To insulate your business against emergent risks and to ensure adequate coverage, it is important to regularly review your commercial insurance coverage. If you have recently added a new product or service area, it is likely you also need extra property and legal liability coverages.
Use an experienced insurance broker
Above all else, the most important decision you may make as a small business owner is to choose an experienced insurance broker to guide your decisions on the commercial insurance coverages your business needs.
Insurance brokers are trained in risk assessment. They act in the best interests of the insured and are your best advocate in the insurance transaction. A good insurance broker will also compare insurance quotes from multiple insurers to get you the best commercial insurance deals in Toronto.
Choose the Able Elite Team insurance brokerage for the best quotes and commercial insurance guidance in Toronto. Contact us here for a free consultation.