Preparing for a Smooth Business Insurance Quote

Getting a business insurance quote doesn’t have to be a daunting task. With the right information on hand, you can ensure a smooth and efficient process. While every business has unique risks and needs, this guide clearly outlines the basics that most insurance carriers typically ask for when preparing to send your risk out for a quote.

1. The Basics

To get started, your insurance agent will need to understand the foundation of your business, including:

• Business Location(s) and Areas of Operation: Where is your business located, and what geographical areas do you serve?
• Industry and Scope of Work: What products or services do you offer? This helps insurers understand your unique risks.
• Business Owner Information: This includes the owner’s name, experience in the industry, and EIN (Employer Identification Number).
• Gross Annual Sales: Knowing your revenue helps carriers assess your business size and exposure. If this is a new business, an estimated gross annual revenue will suffice.
• Structure of the Business: Is your business an LLC, corporation, partnership, or sole proprietorship?

2. Employee Information

Employees are an essential part of your operations, and therefore, their information directly impacts your insurance needs and risk exposures. For instance, factors like the number of employees, their roles, and total payroll all contribute to determining appropriate coverage levels and costs.

• Number of Employees: Full-time, part-time, and seasonal employees.
• Annual Payroll: Total wages paid to employees annually.
• Subcontractor Costs: How much do you spend on subcontractors? This is crucial for liability considerations.

3. Materials and Equipment

Since certain tools and materials are riskier and more expensive than others, the equipment you use to run your business also plays a significant role in determining the type of insurance coverage you need. For example, specialized or high-value equipment may require additional protection, while everyday tools might be covered under standard policies.

• Valuable Tools and Equipment: Any tools or equipment valued over $1,000 should be listed separately.
• Operational Tools and Materials: Include all items essential to your day-to-day work.

4. Claims History

Insurance carriers look for responsible business owners. Your past insurance claims provide insight into potential risks and how they’re managed:

• Number of Claims in the Past 5 Years: A summary of your claim history.
• Details of Each Claim: Include the date of loss, the amount paid by the insurance company, and safety measures you’ve implemented to prevent similar incidents.
• Loss Runs: If you’ve been insured previously, carriers may request a “loss runs” report from your current insurer to assess your insurance history. Think of this as your “insurance score” similar to a credit score.

5. Property Information

For businesses with physical locations or storage facilities, it is important to provide additional property details to ensure comprehensive coverage and accurate risk assessment:

• Use of the Building: Do you own the property? Are there other offices within the building?
• Building Details: Age, total square footage, and any other structures like detached garages.
• Updates: Information on recent updates to roofing, plumbing, or electrical systems.
• Safety Features: Sprinkler systems, alarms, or other safety measures in place.
• Mortgage Information: If applicable, lenders may need to be listed on the policy.

6. Vendors, Lessors, and Contracts

Your relationships with vendors, lessors, and contracts also influence your insurance needs:

• Vendors Who Sell Your Products: Who distributes or sells your products?
• Equipment Lessors: Details on leased equipment used in your business.
• Leased Space: Information on the property you rent for your operations.
• Scheduled Contracts: Any contracts requiring insurance coverage.

Why Honesty and Transparency Matter

It’s no secret that this is a lot of information, but it’s all essential to get you the best coverage possible. Being upfront and transparent is critical in the quoting process. The last thing you want is for your insurance company to cancel your policy after discovering a service or risk you didn’t disclose. For example, if your business offers a service that your carrier doesn’t insure, it could lead to denial of coverage during a claim or even policy cancellation.

Insurance carriers assess your risk accurately and ensure your business fits their services by using this information. Providing complete and accurate information protects you and helps build a solid relationship with your insurance provider. By preparing this information in advance, you’ll make the quoting process faster, smoother, and stress-free—ensuring your business has the coverage it needs to thrive.

If you’re in the market for insurance quote options, please reach out to me! I’d be happy to provide you with a quote or review your current coverage on your insurance policy. You can reach me via email: megan@mcsheainsurance.com or DM: @insurancegirlmeg