Last Updated on: 22nd November 2023, 06:41 am
Business owners and professionals need a wide range of insurance policies to offer protection against the risks associated with the type of business they run. For instance, doctors need liability insurance to protect themselves against malpractice lawsuits. Tradesmen, such as plumbers, electricians, masons and HVAC technicians also need liability insurance to protect themselves from liabilities that may arise in the day-to-day operations. By working with a reputable liability insurance broker, business owners and professionals can be assured of getting sufficient coverage for all the risks that may arise in their day-to-day operations.
What Liability Insurance Covers
i) Legal Fees
Public or general liability insurance pays legal fees for the policyholder when an injury lawsuit is filed against them. Since legal expenses are usually high and can run into the tens or hundreds of thousands of dollars, having this type of policy can be incredibly helpful. With this cover, you will not need to worry about using your personal resources or working capital for your business to cater for legal expenses. The insurer will pay legal fees whether the defense is successful or not.
ii) Damages
In personal injury suits, what plaintiffs usually seek is an award for damages. They want to be compensated for the perceived financial injuries they incurred due to the negligence of the defendant. Whether the case is merited or not, the plaintiff can win the case simply because they have a great lawyer. As a result, the court may award hundreds of thousands of dollars, or even millions of dollars, in compensation for injuries. Since no small business can pay such a huge sum without having to declare bankruptcy or closing shop, business owners are advised to purchase a suitable liability insurance policy.
The Importance of Working With an Insurance Broker
It is possible to go directly to an insurance company to purchase the type of liability coverage you want. However, there are some shortcomings to this approach. For starters, insurance companies are usually busy, so you may not get the attention you deserve. As a result, you may end up with a policy that does not suit your business needs. Secondly, you may not get the best possible deal on the market because you lack the time, expertise and resources needed to scour the market for the best deals.
When you consult a competent insurance brokerage firm, you can be assured of finding the best possible insurance policy for your liability coverage needs. After all, they have access to information you may not be able to access. They also have a team of professionals who scour the market for the best deals for different types of clients. The best thing about insurance brokers is that they can assess your business needs to identify the most suitable liability coverage for your business. That is why it is recommended you work with insurance brokers instead of going directly to insurance providers.
Guide to Choosing a Broker
There is no doubt that there is a huge number of insurance brokers in every city. However, it is important to note that these firms are not all equal. Some of them offer better-quality services than others. For this reason, it is crucial you spend some time comparing the top brokerage firms before you commit yourself. In this regard, the following are key factors to consider:
i) Licensing
This is the most crucial factor of consideration. Nobody wants to work with a quack, so the first thing to check is whether or not a firm has been licensed to offer insurance services in the state. Any firm that does not seem to be licensed should be removed from your shortlist.
ii) Independence
Most brokerage firms are simply contracted agents for insurance companies. If you approach these agencies, you will be provided with a limited list of service providers, which means you will not necessarily get the best deal. Ideally, you should only consider working with independent insurance brokers. These firms will scour the whole market to identify the best policy for your needs. In other words, they have your best interests at heart, so they can offer you better value for money.
iii) Experience
Since you will also rely on your broker for information on the best coverage for your business, it is crucial you give priority to the most experienced firms. The years of experience a broker has, coupled with the type and number of policies they have previously helped clients to secure, can help you determine whether or not a broker is best suited for your needs.
iv) Reputation
It is crucial you read reviews, check ratings and go through testimonials to learn more about the reputation different brokers have developed over the years. You want to hire a trusted and reliable broker with a reputation for providing clients with the best insurance policies.
Before you can commit yourself to a particular broker, you first need to assess the types of liabilities covered by the policies they offer. The liability coverage limits should also be assessed to ensure the policy offers sufficient protection for the liabilities your business is exposed to on a regular basis.
