As you may know, it’s pretty easy to receive commercial insurance quotes. But what about when you get the quotes? It's crucial that you understand the information you are reviewing so you know that you have the right coverage to protect your business. Each quote tells you what kind of policy you are looking at and what kind of coverage it offers. For instance, your business owner’s policy quote may break down your coverages and their accompanying limits like this:
Liability coverage: bodily injury and property damage
$1 million: General liability per occurrence. This is the amount your policy can pay for any single general liability claim, such as a lawsuit over bodily injuries that happened on your property.
$2 million: General liability annual aggregate. This is the total your policy can pay for all general liability claims filed during one policy year.
$1 million: Personal and advertising injury per occurrence. If you’re sued over copyright infringement or defamation, your policy can contribute $1 million toward legal expenses.
$2 million: Products completed operations aggregate. If you create or sell something that causes someone physical harm, you can be held liable for the damages. Your policy can offer $2 million in coverage for legal expenses.
$1 million: Damage to premises rented to you. If you’re liable for damaging rented property, your policy can compensate the owner.
$10,000: Medical. This is what your policy can pay in immediate medical expenses (like an ambulance) in the hopes of averting a lawsuit when someone is injured on your property or by your work.
$10,000: Data breach response. This is the amount your policy can pay to help you recover after your business suffers a data breach.
$50,000: Data breach defense. This is the amount of coverage you can receive if you’re sued over a data breach.
Property coverage: Your property and your client's property in your possession
$500: Property claim deductible. You must pay this amount toward a claim in order to receive your property insurance benefits.
$10,000: Business property. If your assets are lost or damaged in a covered event (e.g., a fire), your policy can pay out $10,000 for you to repair or replace the insured property.
$10,000: Business computers and media. If your computers, tablets, or smartphones are damaged or lost in a covered event, your property insurance can compensate you up to $10,000.
$5,000: Laptop computer – worldwide. This means you can be reimbursed up to $5,000 if a covered event destroys your laptop, even if it happens while you’re out of the country.
If this particular policy costs $635 or so in annual premiums, you can see that you’re getting a lot of bang for your buck. You even get some cyber liability protection thrown into the mix.
Your quotes might also include concise explanations of whether the policy meets the requirements in your client contract (if applicable). For example, you might see something like, “Meets contract requirement for commercial general liability insurance.”
Lastly, here are some keywords you’ll need to understand when looking at policy limits and coverages:
- Per-occurrence limit: The highest amount of your policy will pay for any single claim.
- Aggregate limit: The total of your policy will pay for all the claims in a single policy period (usually a year).
- Deductible: The amount you’ll pay out of pocket before you can receive your insurance benefits.
If you have policy questions, contact us today to get the conversation started.
If you need a quote for a policy, our commercial representative will be happy to help you find the best coverage for your business needs.