What Would Make Your Business Insurance Rates Go Up?
Posted on: 24 November 2017
The cost of operating a business takes in a number of expense line items. Some of those major expense line items include payroll, payroll taxes, payroll benefits, occupancy fees, utilities, etc. One additional expense line item, but one that is most needed, is that of business insurance. Specifically, the purchase of business insurance to cover any vehicles that belong to the business is particularly needed. The reason for acquiring good business insurance for the vehicles owned by the business is to protect the fleet and employees, replace the fleet if there are accidents, and protect the company from loss and possible litigation if involved in an accident.
When it comes to business insurance, one of the key factors that may cause an increase in the businesses insurance rates is the involvement of the business drivers in traffic violations. These traffic violations could include running red lights, making illegal turns, speeding, etc. These violations speak to carelessness, as interpreted by the insurance companies -- or as not being attentive, or as employing drivers who are not well trained. Therefore, the insurance company is forced to increase the insurance rates of the company in anticipation of future losses.
Another reason why a business may realize an increase in their business insurance rates is due to an increase in accidents or fender-benders within the company. When a vehicle belonging to the company's fleet is involved in an accident, generally the company will make a claim to recoup any damage costs associated with the accident. Consequently, the insurance company pays out on the claim, but as a result, the business may realize an increase in their premiums due to the accident and the insurance company paying out to cover the associated accident costs.
Increased Number of Vehicles
Another factor that may increase the business insurance rates for a company is growth within the company. This may sound a little crazy, but if there is an increase in business, this may also necessitate adding to the fleet of vehicles necessary to keep up with the customer's demands and needs. Consequently, if there is an increase in the number of vehicles that are used to deliver service, there may be a corresponding increase in insurance rates. The rationale is that more vehicles equates to an increased risk of those vehicles being involved in an accident.
Business insurance from a company like Ahlquist Insurance is a necessary cost to conduct business. This is due to the fact that it protects your assets, your employees and above all your company. Therefore, it is important to obtain good business insurance.Share