Business Insurance

For businesses and non-profit groups in Canada, having the right insurance is essential to surviving and thriving in a world that is full of opportunity, but also full of risk. The right type and amount of insurance will provide some financial peace of mind to organizations navigating their way through the sometimes-complex world of business. For example, in a society that is turning more and more often to the legal system to settle conflicts, insurance that protects an organization and its employees and/or volunteers from lawsuits (that is, liability insurance) is more important than ever.

For smaller businesses and community, social and recreational groups, finding and maintaining business insurance can be critical to survival. But in some cases, the risks involved in insuring these organizations make affordable insurance difficult to find. Canada’s business insurers are working with representatives from the business world, the non-profit sector, insurance companies and governments to come up with, and implement, practical solutions to this problem. With these solutions in place, Canadian organizations will have better access to affordable business insurance, and to financial peace of mind.

Choosing Coverages, Deductibles and a Limit

Coverages

The various insurance policies available to organizations include:

Accounts receivable
Comprehensive or commercial general liability (CGL)
Property
Crime
Commercial automobile
Errors and omissions
Directors and officers

Every organization requires its own set of coverages. Discuss your needs with your insurance representative. The more your representative knows about your organization, the better prepared he/she will be to advise you about the type of insurance you need.

Periodically review your insurance policy with your insurance representative. Over time, your organization may grow and your insurance needs may increase. Alternatively, you could find yourself paying for coverage you don’t need.

Deductibles
Deductibles ensure that insurance is doing what it is intended to do – pay for the substantial losses, not the minor ones. Deductibles keep premiums low. Essentially, the deductible is the amount for which you are self-insured. The higher the deductible, the lower the insurance premium.

Deductibles (cont'd)

To determine the amount for which you are prepared to self-insure, consider the following:

Look at the premium levels for various deductible options. The money saved on the premium by raising the deductible may or may not be worth it.
Look at your loss history. If you have a lot of claims, you could find yourself paying the deductible many times over. Paying a higher premium to get a lower deductible might make sense.
Consider talking with a risk management consultant to determine optimal deductible levels.

Policy Limits
You want to have adequate coverage without being over-insured and paying too much. To make an accurate calculation, work with your insurance representative and consider the following:

The value of your property: If you lost everything in a fire, what would be the cost of that loss?
Your potential liability exposure: Property is only one aspect of what insurance covers. Insurance also protects you if you get sued. It pays for legal costs and damages if you’re found to have been liable for a person’s injuries. Some operations are higher risk than others. A nightclub, for example, is more vulnerable to lawsuits than a flower shop and will therefore need higher liability limits.
Past losses: Use your claims history as a guide when comparing quotes for different policy limit options.

Choosing Coverages, Deductibles and a Limit

Coverages

Policy Limits You want to have adequate coverage without being over-insured and paying too much. To make an accurate calculation, work with your insurance representative and consider the following:

Policy Limits
You want to have adequate coverage without being over-insured and paying too much. To make an accurate calculation, work with your insurance representative and consider the following: