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General Questions:
Commercial Insurance Questions:
General Questions:
1. What is Actual Cash Value(ACV)?
Answer: For a building, this figure is determined as a replacement cost less depreication. The calculation of the replacement cost is developed by building cost manuals which include the material and labor costs for contruction in that area. The depreciation figure that is subtracted from the replacement cost is based upon various depreication guides and typically includes a visual inspection of the property. Factor that affect a building’s ACV include: type of construction, year built, present condition, and repairs made over its life. For contents, ACV is the replacement cost less depreciation for the artlice that is damaged, destroyed or stolen.
2. What is Replacement Cost?
Answer: The cost, at the time of the loss, of a new article identical to the one damaged, destroyed or stolen. When the identical article is no longer manufactured or is not available, replacement cost will mean the cost of a new article similar to that damaged or destroyed and which is of comparable quality and usefulness.
3. What is a Premium?
Answer: The money paid to the insurance company for the policy of insurance.
4. What is a Personal Umbrella Policy?
Answer: It is an excess liability policy that provides coverage over your personal property, home, boat, auto, etc. Generally, the policy limits are offered between $1 million and 10 million. The underlying insurance on your personal property must meet the specific guidelines set forth by the insurance carrier. Liability coverage pays on behalf of the insured the sums which the insured shall become legally obligated to pay as damages because of bodily injury or property damage.
5. What is the purpose of a deductible?
Answer: To deter the insured from turning in claims at random.
Commercial Insurance Questions:
1. What are the essential coverage’s for small businesses?
Answer: A Business Owners (or Package Policy) can provide special property coverage on your building contents, business income and computers. It can also provide crime, equipment and fidelity coverage. The policy will include liability coverage for your premises, operations, product and completed operations and liability exposures. All small business should have the Business Owners Policy, workers comp, auto, umbrella and flood.
Why?
- Auto: If necessary to cover both liability and physical damaged for owned autos or trucks used in the business
- Workers Compensation: Statutory limits for accidents, disease or illness which occurred on the job and are incidental to your job. Employer’s liability provides coverage for your company if a claim is presented for a job-related injury.
- Flood: We do offer Flood insurance when your Mortgage company requires the coverage.
- Umbrella: This is excess liability over and above your primary liability coverages. Limits are usually 5-10 million dollars. Higher limits can be purchased.
- Other Coverage’s that you may want: Retirement plans, Dental, Life, Accident and Health, Disability, Long Term Care.
2. Everyone is suing people these days. What if someone sues my business?
Answer: Liability insurance protects your business assets when the business is sued for something the business did or failed to do that contributed to injury or property damage to someone else. No business can prepare for someone suing them. Liability coverage extends not only to paying damages but also to the attorney’s fees and other costs involved in defending against the lawsuit-vaild or not. The standard buisnessowners policy provides liability coverage, as does a separate policy known as commercial general liability insurance policy. This generally will cover bodily injury, property damage, advertising injury or personal injury. The medical expenses of a person or persons injured at the business or as a direct result of the operations of the business are also covered. Check with your agent about the best liability protection covering all types of situations that may arise in your business.
3. I work out of my home. Will homeowners insurance cover my business?
Answer: Yes, but on a limited basis. Loss of business property is usually remimbured up to $2,500 in the house and up to $250 for business propery damaged or lost away from the premises. Even if your business is a sideline such as a craft studio, thes limits may be too low to cover all the equipment and materials you have accumulated. It is also important to know that no business liability coverage is included in a standard homeowners policy. Your insurance agent can help you ascertain what if any additional coverages may be added to your homeowners policy or if you need a separate commercial policy.
4. Can I do anything to lower my insurance premiums?
Answer: All insurance premiums are based on the risks involved. The insurance company evaluates the situation to determine the risks, or potential for losses-and baes its rates on those results. Therefore, deliberate steps you take to lower your risks can only help your business but also make you eligible for lower insurance rates.
Some Helpful Steps:
- Keep electrical wiring, stairways, flooring, elevators and escalators in good repair
- Make sure your employees have good driving records
- Maintain aqequate lighting throughout your business premises
- Make sure your employees know how to lift properly and use all necessary safety equipment.
- Install a sprinkler system, security system and smoke and fire alarms
- Keep good records of inventory, accounts receivable, and equipment purchases. Also you should keep a record of this off site in case of emergency.
- You can consider using a risk manager. Or an outside consultant that can advise you of any safety or environment regulations that you may have overlooked.
- Talk to your employees about all safety practices and regulations
- You may raise your deductible where appropriate to lower insurance premiums. Be careful not to raise it so high that you can not cover it should a loss occur.
- Make sure your agent is familiar with your business and the risks inherent in it. They should be able to advise you on risk management techniques and their benefits to both you and the insurer.
5. What types of property do I need to insure?
Answer: It all depends on what type of business you have. Below is a list of property categories and any insurance coverage that may be warranted:
- Furniture, Supplies and equipment
- Buildings and other structures(owned or leased)
- Machinary
- Money and securites
- Inventory
- Records of accounts receivable
- Improvments you made to the premises
- Boilers
- Data processing equipemtn and media(this includes computers)
- Valuable papers, books and docments
- Satellite dishes
- Mobile property
- Leased equipment
- Signs, outdoor property not attached to building
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