Insurance is the most critical aspect to secure your business, as it covers the cost associated with liability claims and property damage.
Business insurance not only provides financial assistance but also helps in protecting your business image.
However, due to the coronavirus outbreak, several companies are
cancelling their business insurance to save their capital, but this will make them pay more in the long run. Let's see how:
Higher Premium for New Coverage
There is little chance of getting a full refund if you cancel before your policy expires. Insurance companies see businesses with gaps in coverage as more susceptible to risk. You will need to pay a higher premium for the new coverage when you reopen your business.
Chances of Losing Licenses and Permits
As an employer, regardless of your industry, you must ensure that your staff is covered with a workers' compensation insurance policy. Also, your business should have general liability insurance before a working license or permit is issued.
Cancelling insurance can lead to the risk of having your license or permit revoked.
Risk of Damage or Stolen Property
Every business that has a storefront or office wants to have business insurance to cover all the expenses associated with damaged or stolen property. A policy cancellation multiplies this risk, as you need to cover the cost of thefts or damages.
Default on Lease Agreement or Loans
If your business depends on loans for survival, having insurance is necessary. If you temporarily cancel your insurance policy, you may find yourself in default, even if you are current with your payments.
Adjust Your Coverage
Business insurance cancellation is not the only way to save your capital. Reach out to your insurance company to discuss coverage adjustment options. Keep in mind that many policies allow you to modify your premium if you are projecting lower revenue.
You need to act wisely to save your businesses in times like these but
cancelling business insurance is not the right solution. For assistance with all your commercial insurance needs, contact the experts at
Club Agency Insurance Brokerage in Garden City, New York today.
