Here are some off the things that will affect how your business’s insurance premiums are calculated.
As a business owner, you probably know that your business needs to have the right commercial insurance protections in place. However, that might be all that you know about the insurance industry. As a result, you probably have a lot of questions regarding your business’s coverage. For instance, you might be wondering exactly how your business’s insurance rates are determined. To clear things up, here are some of the factors that influence your business’s insurance costs.
Some businesses are simply more inherently risky than others. For instance, businesses involved in the construction industry are simply more risk than those involved in the retail sector. If your business is involved in a high-risk industry, you should expect your insurance rates to be on the higher side. This increased insurance cost is meant to offset the likelihood of your business having to file a claim.
Your business’s location also plays a big role in how much your company will pay for insurance. For instance, if your business is located in an area prone to certain natural disasters (flood, earthquake, hurricane, etc.), you will be at a higher risk for sustaining physical damages. This increased risk will translate into higher insurance costs. Additionally, if your business is located in an area with high crime rates, your insurance costs will be higher due to your increased risk for vandalism and break-in.
Finally, your claim history will also affect how your business’s insurance premiums are determined. For instance, if you have filed several claims within the last few years, this indicates that your business engages in risky business operations. This, in turn, will mean higher insurance premiums. However, if your business’s claim history is relatively clean, you will likely have access to cheaper rates.
These are some of the factors that influence your commercial insurance costs. Do you have additional questions regarding your business insurance? Then don’t hesitate to contact the experts at Promised Land Insurance Group. Our dedicated team is ready to get you covered today.