Inflation has become a crisis nationwide. As you’re likely looking for ways to lower the impact on your business’ finances, insurance premiums are an area to consider. While rates continue to rise, there are strategies to lower your premiums or keep them from increasing. 

1. Be Open Minded

While you may be loyal to a certain carrier for your commercial insurance, this doesn’t mean you’re receiving the best pricing or coverage. Rates vary by carrier, and brokers can help you to evaluate options and actively look for the best protection and price. 

2. Don’t Just Consider Price

Brokers should offer a fair price and deliver quality service should you need to file a claim. They can also provide potential options and strategies to lower your costs. Remember to compare prices and the services you will receive as cutting costs may not be the best option overall.

3. Increase Your Deductible

Deductibles are conditional policy terms that designate the amount of money you will contribute toward a loss before your insurance company begins paying on your claim. The higher your deductible, the more money you can save on your premiums. Your insurance program may have multiple deductibles based on coverage options. Businesses located in disaster-prone areas may have separate deductibles for weather-related events (e.g., windstorm, hail, flooding). Increasing your deductibles on these areas can have a larger impact on your premiums. 

4. Don’t Be Caught Overinsured or Underinsured

Land is not at risk for theft or natural disasters. Exclude its value when considering your insurance coverage or you’ll be paying higher premiums than necessary. Keep current on your property’s valuation to verify an accurate representation of a true replacement cost. Additionally, policies can have clauses that enact penalties for insureds that overinsure or underinsure. In the current inflationary market, it’s especially important to make sure your valuation is accurate. 

5. Consolidate Multiple Policies

Lower premiums by combining multiple insurance policies into a single package of coverage. Many insureds discover coverages are cheaper in a package policy as carriers will provide discounts for multiple commercial lines. Ask your broker to verify that creating a packaged program for your policies is lower than purchasing separate coverages. 

6. Implement Risk Prevention Measures

Influence commercial property premiums by following risk prevention tactics to make your property and operations more resistant to natural disasters. Your broker can offer valuable strategies, including workplace safety, disaster preparation and human resource interventions. Simple reinforcements to your building or installing strong materials can help save on premiums. Modernizing your heating, plumbing and electrical systems will reduce the risk of fire and water damage. 

7. Improve Security Measures

Many carriers will offer discounts for installing detectors, burglar alarms, security systems or other theft-prevention devices. Influence premiums with sophisticated sprinkler systems or fire/burglar alarms that immediately contact the police, fire or other monitoring stations. These systems can be pricy and not all will qualify for a discount. Prior to purchasing or contracting, verify insurer recommendations and evaluate if the savings outweigh the expenses.

8. Maintain Good Credit

Your business’ credit history can have an influence on insurance costs. Protect your credit standing by paying bills promptly, refraining from overextending your credit and keeping credit balances as low as possible. Regularly check your company’s financial standing and credit records to promptly correct any potential errors.

9. Annually Review Policy & Property Values

Your policy should cover any major purchases and operational or property improvements. Take time to review current equipment and property values. As older assets can devalue, you may want to lower coverage on depreciated assets. 

10. Work With Your Broker

Your trusted broker can offer advice and suggestions to protect and prevent disaster claims. Their options can reduce risks (e.g., accidents, flooding, damages) as well as help your business recover quickly from catastrophic events. Coordinating the right coverage with a disaster-prevention plan can save your bottom line and prevent your business from going under. 

We’re Here to Help Lower your Commercial Property Insurance Premiums

If you have questions about your commercial property insurance, your broker can help to make sure you have the best protection for your budget. Additionally, risk prevention tactics may offer discounts or keep premiums from increasing. An annual review can ensure you have the coverages that your business needs. If you have questions about your commercial property insurance or risk prevention strategies, connect with a member of our team.