Insurance Coverage Limits: An Overview
The role of an insurance agency is to protect or cover your losses in case of accidents or unexpected disasters. The insurance coverage limit refers to the maximum amount your insurer will pay for a single incident or claim. The greater the threshold, the higher the premium you have to pay.
Here’s what you need to know about insurance coverage limits:
Cost vs. Coverage
When buying insurance, you have the freedom to choose the liability limit. Keep in mind that the more the risk associated with the asset you are insuring, the more you have to pay.
Not having the right coverage when you need it makes your business vulnerable to lawsuits. You should find a balance between the risk level and the monthly premium you are paying.
The minimum insurance will vary based on state laws as well. For example, in New York, it is $500,000.
Business Insurance Coverage
General liability insurance policies for commercial businesses cover incidents like accidental customer injuries, electronic data loss, and defense costs.
The most commonly chosen general liability insurance is $1 million/$2 million coverage, which means that the insurer will pay up to $1 million to cover any single claim when the policy is active, and up to $2 million during the policy lifetime.
The factors affecting insurance coverage limit include:
• The payroll
• The industry
• The nature and risk-level of the employees’ work
• The claims history
As with most commercial insurance, not being aware of the liability coverage limits puts you at risk of being under-insured. Before approaching an insurance agency, it’s better to evaluate your total assets to get a fair price for the policy.
These are some of the aspects of business insurance coverage limits that you should consider before buying a policy. For more information on insurance coverage, contact the experts at Club Agency Insurance Brokerage in Garden City, New York. We are ready to help you get the right insurance coverage today.