Liability Insurance

Natril Gear is planning to get liability insurance coverage.  So far, I have attempted to get quotes from three different insurance companies.   Here are some questions you will need to be prepared to ANSWER and also some good questions for you to ASK when looking for insurance.

Natril Gear is planning to get liability insurance coverage.   Liability insurance is a great thing for all businesses to have.  There are a variety of types of liability coverage; Natril Gear is getting “General Liability Coverage”.

As I’ve been talking to others about it, some people wonder why we need it.  After all, we just make bags…what could someone sue us for about a bag?  Well, in order for people to use our bags, they have to be riding their bikes, and as soon as they start pedaling, there is potential for them to fall or crash and get hurt.  And let me be honest, since it seems like almost anyone can sue for almost anything now, I’m not willing for Natril Gear to be without insurance. 

We are very small and don’t have a lot of money, so a lawsuit could easily force us into bankruptcy.   The protection we'll get from having liability insurance is a necessity for Natril Gear, and I would highly recommend liability insurance to all small business owners.

I have attempted to get quotes from three different insurance companies so far.  From my experience, here are some questions you will need to be prepared to ANSWER to get a quote and also some good questions for you to ASK.  

Questions to ANSWER (questions might vary depending on what field/industry your business is in):

  1. Where is your office located?
  2. How old is the building where your office is located?
  3. How much is the business’s property worth that is stored in the office?  (ie: If there is a fire or theft, how much of your business property to do you want to have coverage on?)
  4. How much revenue do you expect to take in this year? (revenue, not profit)
  5. If your product is being manufactured, what types of materials are going to be used?

Questions to ASK:

  1. How do you determine how much coverage is appropriate?  (This is typically determined by a combination of 1) your expected annual revenue, and 2) the existing risk factor for your industry/service.)
  2. How does a claim affect your rates?  (Your premium may go up after a claim, but you should ask about any specific amounts, number of claims, etc.)
  3. Can you add an “umbrella policy”?  (This gives added liability protection when the liability on your other policy(s) has been exhausted.  As your insurer if it’s a good idea for you.)
  4. Is all of my property used in my business covered under my homeowners insurance, or do I need a rider for my business liability insurance?
  5. Is my business income protected if something happens to my home and I have to close my business for a period of time due to flood, fire, storm damage, etc.
  6. Are the actions of helpers and volunteers covered?
  7. If a lawsuit occurs, will insurance provide immediate money for legal defense? 

After you have had a conversation with an insurance salesman, be prepared to wait a week or two for them to get back to you with a quote.  Also, when you are dealing with them, always remember to be evaluating the salesman on their customer service.  An insurance company with good customer service can save you a lot of headaches if you ever have to file a claim with them!

I hope this was helpful to you and aids you in getting your business the coverage and protection it needs.  Best of luck!

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