Businesses have a lot of costs to manage. One of those costs is the insurance you carry. Depending on where you’re located, you may be required to carry workers comp insurance, but generally aren’t required to carry liability insurance. That may leave you wondering whether or not it’s really necessary to carry it, especially if you have a low incident rate.
Understanding Incident Rates
To start, it’s important to understand incident rates and how they impact a business. Incident rates are the frequency with which events occur. In this case, it refers to accidents and injuries at your business. It’s important to note that different industries have different averages for incident rates since the risks are often somewhat unique to the industry. There are different calculators you can use to analyze your incident rate and then compare your rates to other businesses in your industry. Closely analyze the incident rate at your business to get a feel for where you’re at currently.
All Businesses Need for Insurance
Regardless of whether your incident rate is big or small, you still need insurance. Your incident rate can be a good indicator of how well you’re doing in terms of risk management and what you’re likely to see in the future should things stay as they are. That isn’t a guarantee that things won’t change or that you’ll maintain the same incident rate going forward though. There’s always the risk of human error or equipment malfunction that could result in injury or, in extreme cases, death. Considering the average cost of an injury claim, it’s better to always carry insurance and reduce your financial liability.
Finding the Right Coverage
While it’s important to carry insurance, it’s also important to manage your costs. One of the ways you can do this is by making sure you have the right coverage. There are a variety of types of insurance that businesses may need and Harris Insurance can help you craft the right package for your business. Carefully read through your policies and talk with your Agent so you understand what is covered and what is not. Compare that with the price you’re quoted so you can start to get an idea of what the value of the policy is. This will help you find a balance between coverage and cost.
Even if you have a low incident rate, it’s still important to carry insurance. Start by making sure you understand your incident rate and what your specific insurance needs are. It’s a certainty that you’ll be better off as a business if you carry insurance, so take the time to find the right coverage for your business. Let us know how we can help you and your business today!
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LEGAL DISCLAIMER
Views expressed here do not constitute legal advice. The information contained herein is for general guidance of matter only and not for the purpose of providing legal advice. Discussion of insurance policy language is descriptive only. Every policy has different policy language. Coverage afforded under any insurance policy issued is subject to individual policy terms and conditions. Please refer to your policy for the actual language.
