Keeping costs down is a fundamental practice for businesses of all magnitudes. For small to medium-sized operations, it can be the difference between breaking even and turning a profit.
Insurance is a necessity for businesses to prepare for the unexpected, but it can be a significant expense. Finding ways to minimise premiums without jeopardising operations can help to make your bottom line look a lot healthier and give you more cash to invest elsewhere.
What types of insurance do SMEs need?
The type of insurance your business needs depends on your industry, size and operations.
The only one you’re legally required to take out as a small business, presuming you have employees, is employers’ liability insurance. This financially protects the company if one of your workers makes an injury or illness at work claim.
But many businesses have premises that need protecting. Commercial buildings and contents insurance should cover your workplace and equipment in the event of an accident, fire, theft, crime or natural disaster.
For any public-facing business, public liability insurance protects the company if any harm is done to someone’s property or if a member of the public is injured because of the work being done.
Many professionals drive company vehicles or travel on behalf of the organisation, so the appropriate business car or van insurance is often needed where a fleet is being managed.
For sporadic work travel, you can invest in temporary car insurance to avoid paying premiums all year round.
How to save on business insurance
Trying to save on insurance premiums may seem like a lot of hassle for a busy business owner like yourself. But cost-cutting can make a world of difference for your financials. Here are some of the best ways to minimise your insurance costs:
- Don’t renew automatically – Renewing your insurance policy automatically each year is a big mistake that many business owners make. The renewal offer provided by your insurer is never their best price, and you can always haggle them down when you’re nearing the end of your current contract.
- Compare providers – If your current provider isn’t giving you the price you’re looking for, then there’s no harm in looking elsewhere. Compare offerings from insurers on comparison websites to find the best deal available. If you find a better offer elsewhere, you can usually use that to leverage a better deal with your current provider anyway.
- Consider a comprehensive package – Many business insurance providers offer comprehensive policies that roll all your needs into one package. These can make the insurance process much simpler and potentially reduce your overall costs.
- Improve your track record – Insurers are more inclined to offer lower premiums to businesses that have a better track record when it comes to safety, security and previous claims. Focus on maintaining high safety standards and invest in security measures to reduce your operational risk.