3 factors to consider before buying business insurance

Presented by Intact Insurance

There are more than a fistful of business insurance providers that operate in Canada, all of which would be happy to have your business. But how do you choose which one to go with?

The cost of insurance coverage is often a reining factor when deciding, but there are other elements that need to be considered. Before signing on any dotted lines, learn a bit more about the company and the value it puts on customer service and care. Here are three factors to consider.

1. Business structure

Does your insurance provider operate out of one centralized metropolitan office or does it have branches throughout the country? This could make a difference in the products the company has on offer and the advice you receive.

“Using a company with regional offices in each province makes it easier to get knowledgeable advice of the local area,” says Gordon Payne, commercial lines director with Intact Insurance. He says having insurance is one thing, but having the right insurance is another.

When a provider operates on a regional structure and the unexpected happens the provider is often better equipped to deal with these situations immediately, which means better service for your business and less down time.

Payne gives the examples of Calgary flooding in June 2014 and the more recent Fort McMurray forest fire in April 2016. The fact that Intact Insurance has multiple offices in Alberta and relationships with local companies and contractors made it possible to “pull together a response to help policyholders quickly and effectively,” he says.

Consider the “what ifs” when purchasing insurance and ask about how the provider will be able help if those “what ifs” turn into a reality.

2. Customer care

Your business is more than just business to you. It’s a product of your hard work, your money, and your time. When something goes wrong — a theft, a fire — it can be an emotional process. You want to work with someone that understands your business isn’t just a paycheque. Personal care, genuine interest and a feeling that your needs are put first is what you want to get when speaking with a broker. If you feel like you’re just another number, consider taking your business elsewhere.

3. Stability

Another factor that comes into play is the financial stability of an insurance provider. Just as you want your business to be around for years to come, you obviously want your insurance provider to be around just as long.

But how do you know the real stability of a provider? This could be a question for your broker. “Some brokers simply won’t place policies with companies that don’t have high ratings,” says Payne.

A provider’s balance sheet is another place you can look to get an idea of the company’s strength. If a provider is publicly traded, this information can be found in its annual general report. If they aren’t publicly traded, ask your broker if the company is willing to share this info.

The insurance industry is highly regulated by the government. Companies are mandated to meet capital requirements, meaning that for every dollar a company underwrites it needs to have a certain amount of capital in its coffers. “How close they are to their minimum requirements could give you an indication of how the company is doing overall,” Payne says.

More than just money

When you’re shopping around for insurance, or using a broker to do so, take the time to look beyond the cost. As you know, in a small business every dollar needs to be spent wisely and relationships entered into with care. Having insurance for your small business is paramount and working with a company that understands your needs and that will be able to serve you long-term will make a big difference.

This is paid content provided by or produced on behalf of Intact Insurance.

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