Commercial insurance coverage in Kleinburg financially protects companies from the risks associated with operating a business.
It’s exactly what business owners need in order to cover things like property insurance, liability, commercial auto, and key employees.
However, insurance can only protect up to the limits of your coverage. If the company grows or implements significant changes, then it may require different coverage types or expansion.
Luckily, insurance policies aren’t usually fixed; they can grow with your business.
Here are nine instances when you should update your insurance to match the value and size of your business.
1. After renovating or upgrading your workspace
Your commercial property insurance should accurately reflect the value of your business space. Make sure you update your policy when you’re renovating offices, adding extensions, or doing any other updates to your building.
For example, update your policy coverage to account for these expenses after replacing floors and installing new light fixtures and appliances.
If you don’t and experience a covered loss, you’ll only be covered under your old policy, and those new upgrades will have to be replaced with your own money.
You’ll also need to update your policy if you switch locations altogether. The physical location of your office is a critical factor in calculating commercial insurance.
2. New products in your business
A business can decide to add, reduce, or change the products they offer customers at any time. The COVID-19 pandemic is an excellent example wherein many companies started selling masks, sanitizers, and other hygiene products.
New products can increase your risk exposure, so it’s good to ensure your product liability insurance coverage is still enough.
Updating your product liability insurance will also help protect you if your products are defective and need to be replaced.
Also, when you’re storing new products in your warehouse, adding them to your insurance policy can protect your investment if they happen to be stolen.
3. You’ve hired more employees (or plan to)
An increase in the size of your business likely means you’ll need more employees to run it efficiently. You’ll need to update your insurance policy when hiring because more employees equal greater risk.
Does your current policy cover key employees? Updating coverage for vital employees will keep your business afloat should they be unable to work.
Keep in mind that if new employees are driving company vehicles, you’ll also need to update your commercial auto insurance.
If you hire subcontractors, it’s unlikely that your insurance policy will cover them, so make sure they have their own. This will protect your business from liability should they be sued for damages or wrongdoing.
4. Your business revenue is growing
When your business grows, so do your revenue and your assets. That can mean many good things like more customers or an increase in online traffic, but it also increases your business’s risk exposure.
If you’ve seen significant revenue growth, you should consider talking to a broker about upgrading your coverage amount for general liability insurance and business interruption insurance.
A good rule of thumb is to update your policy when it covers less than your current assets. This way, you won’t take a significant loss if something requires you to file a claim.
5. Changes to your car fleet
If you use five or more vehicles for your business, you may qualify for fleet insurance.
All cars used for commercial purposes must be covered by a commercial auto or fleet insurance policy. If you’re adding or changing vehicles in your fleet, simply update your policy to ensure you’re fully covered in the event of an accident.
If you don’t have fleet insurance, new vehicles need to have their own commercial auto insurance policy set up.
Remember that personal auto insurance is different from commercial auto insurance. Your company can still be sued after an accident, even if a personal policy covers your employees.
6. You need director’s and officer’s insurance
Significant growth in your business could reveal the need for a corporate board. Directors and officers make many big decisions on behalf of companies that may come back to bite the uninsured.
It can also be hard to find applicants for these roles without a company insurance policy to protect them should they need it.
You can be sued or held liable for their business decisions if you’re not adequately covered, so update your insurance whenever there are changes in the leadership structure.
7. You’re worried about employee fraud
Hopefully, you’re hiring employees you trust to work with integrity, but if you’re still concerned about fraud, fidelity bonds can help. A fidelity bond is an insurance type that protects your business against fraud or dishonesty.
If an employee steals products or takes money from your business, a fidelity bond can give you compensation to recover your losses.
A blanket fidelity bond can be used for larger businesses; all employees will receive coverage unless expressly excluded. New employees will receive coverage on their start day, and their coverage will cease once they’re no longer employees.
Scheduled fidelity bonds can be helpful when only certain employees need to be covered. Scheduled fidelity bonds only provide coverage to named employees, and each employee can be insured for different amounts.
8. You have new clients
If you’re working with new clients or vendors, congratulations! Forging solid relationships is integral to ensuring a business’s longevity.
Before working with anyone new, be aware that they may require insurance types that your current policy doesn’t cover.
Are you thinking about expanding your operations with an online store? Online merchants may require that you get cybersecurity insurance before setting up your digital store.
9. Changes to your business owner’s insurance policy
Your business owner’s policy (BOP) combines many crucial business coverage types into one convenient policy. It can include general liability, commercial property insurance, business interruption insurance, and other protections.
The bigger your business gets, the more you stand to lose.
The original BOP you bought likely doesn’t provide enough coverage now that the business has grown. Take some time to assess how much change your business has undergone since your first BOP.
If your company has increased in size, you’ll need to increase your coverage to match.