Risk Management

In life as well as running our business we should be well aware of what perils are possible and to take steps to ensure that we either avoid them or to protect ourselves from them as best we can. “Therefore do not worry about tomorrow, for tomorrow will worry about itself. Each day has enough trouble of its own.” (Matthew 6:34) Though our Godly challenge is specific as we are exhorted to not unduly concern ourselves with tomorrow as by our worry ourselves we cannot accomplish anything separate from His power. However the Bible also encourages us by example to plan as he did it himself. “But the plans of the Lord stand firm forever, the purposes of his heart through all generations.” (Psalm 33:11) Just as our God is one or order so should we plan as we go about our business affairs.

Apart from budgeting and planning the financial affairs of a business, protecting the business assets is a critical component of helping to ensure the long-term viability of a business. Though a business will often accumulate wealth, clients, and net worth through a myriad of daily decisions it is often in the very purchase and proper evaluation of insurance needs where one is able to make decisions to overcome calamities. Like all business decisions, Risk Management is an art that depends upon facts in order to be cognizant of important variables so that appropriate coverage’s, risk, limits, and deductibles are considered.

General Liability Insurance

General Liability coverage is the insurance that is placed on the fixed assets of a business. Care should be exercised to ensure that all substantive assets are listed and that they are adequately covered. It is most wise to purchase replacement cost coverage on all of a business’s important assets as in the event of a loss it will be wise to be able to buy what you need to quickly resume operations. Absent replacement coverage polices will depreciate the assets purchased which will result often in substantially less than the replacement cost being received on a loss making the severity of the calamity even greater.

Product Liability Coverage

This coverage is extended to cover a loss that may occur as a result of a customer’s use of a product/service that your business creates. Covering the use, design, and implementation portions of a process covers the seller in defects that might inadvertently occur in the use and handling of your products.

Umbrella Policy

An Umbrella Policy sits on top of your other coverage and gives you additional insurance beyond the face limits of your other policies. Care should be exercised to ensure that the coverage listed is broad enough, that the underlying limits are sufficient, and that the face values of the policy will adequately cover potential losses. Umbrella Policies come into play/are utilized after the basic coverage is utilized/exhausted. Umbrella Policies are able to be purchase both for your business as well as personally.

Errors & Omissions

Especially when you have a business where you are responsible for detailed reports, analysis, and contracts, Errors & Omissions will be a critical piece of coverage to procure/maintain, as it will assist in protecting from losses incurred during these detailed steps and procedures. Similarly as Product Liability Insurance covers the product delivered, Errors & Omissions covers the specific steps, procedures, and correspondence in its delivery.

Policy Pitfalls

Generally most, if not all policies have limitations on the amounts and types of coverage listed. Two of the more widely uncovered events that occur are flood and earthquake. Just as many have discovered along our coasts and as inland flooding have occurred that many policies are limited to wind damage absent a specific flood policy/rider being added. Typically a commercial or personal/homeowners policy will not cover these events as they are specifically listed and excluded from coverage. These limitations often will exclude terrorist acts, and acts of war as well. Care should be given to reviewing the policy in detail to ensure that you are well aware of the types of coverage and appending limitations as many types of coverage that you might have can result in not having sufficient ability to cover losses incurred.

There are many other insurance types available ranging from Errors & Omissions, Directors and Officers, Kidnapping, Malpractice and many more. Having a firm grasp of your business issues of your business and its related insurable issues are important but perhaps just as critical is to have a well seasoned intuitive agent who is well versed with not only commercial lines polices but also your business operations. Appropriate care should be done in the planning stages to ensure that all risks, coverage, limits, and deductibles are appropriately considered.

With decades of buying insurance and evaluating risk we are well poised to assist you in this important purchase decision. We can help you select a comprehensive insurance plan for your business that is well suited to cover your business risks and provides appropriate limits and deductibles.