How much is general liability insurance for your company? Most of the time, the answer to this is “it depends.” That’s because there are numerous factors that play a role in how much you can expect to pay for insurance coverage. Your agent can offer a quote to give you some insight. He or she can also help you find ways to save. Here’s a look at a few of those factors.
What Causes Your Rates to Rise or Fall?
Businesses need general liability insurance. They also need a competitive rate to help them afford their policy. It’s a good idea to compare policies carefully to determine which one offers the right balance for you. Here are some factors that play a role in the cost decision.
• How Much Risk Is There?
Exposure to risk increases costs. Some companies are more likely to be in a situation where they need to file a claim. In some cases, those claims will be much larger than others. Manufacturers, for example, tend to spend more for general liability insurance because there is more risk for fires and claims.
• Where Is the Business?
Most insurers use local data to determine how common claims are within any region. If claims are higher in one area than another, that increases costs. For example, businesses in cities with larger populations tend to pay more than in those areas where there are fewer people. In some areas the cost of living influences this, too. Claims may be higher in New York or California because the cost of an incident is higher there.
• What Size Is the Company?
The larger the company, the more risk the company might face. You have more employees that could cause an accident, for example. Your coverage will cost more than it would if your business had fewer employees.
• How Many Claims?
Companies that file numerous claims are likely to spend more for coverage. You should not avoid filing a claim unless you absolutely need to do so. However, it is possible to avoid frivolous claims.
• How Can You Save Money?
Most companies can save money on general liability insurance. Discounts, higher deductibles, and improving on-the-job safety can help to reduce risks. You may also be able to improve your rates by reducing coverage if it does not fit your needs.
Work with your business insurance agent. Choose the right policy with the best rate for you.