One of the difficult things about selling insurance, and small business insurance isn't any different, is that the well intentioned consumers who purchases these financial services don't intend to have insurance claims.
This belief is actually understandable because the percent of businesses that suffer a loss is, in fact, actually very low. This is a good thing because if it wasn't for the low frequency of loss, then insurance would look much different and cost much more than it already does. But that's a topic for another post.
The reality is that business insurance claims do happen, and while they don't happen frequently, when they do happen they can be very expensive. This isn't a matter of opinion, however, it's an objective fact. And while the data isn't always readily available to the average consumer, insurance carriers keep these numbers and they use them to predict what the costs to cover claims will be in the future.
But this isn't a secret that's being withheld from consumers, in fact insurance carriers will share this data periodically. Recently, The Hartford published their annual business insurance claims study, and in consecutive years, burglary and theft incidents were the most common business insurance claims.
You can study the infographic to the right, and you'll see that burglary and theft claims account for 20 percent of all business insurance claims.
If you own a retail store, this is neither a surprise or exactly good news, but for other business classes that don't allow consumers or the general public to traffic the workplace, this make signal a bit of a reduction in your overall exposure.
Don't be fooled, most burglary and theft claims aren't the sexy, high-ticket, Hollywood plot making heists. In reality, the average burglary and theft is not a muti-million dollar affair, but it is still a significant amount for a small business at an average of $8,000
The bright-side of this story is that you can manage this exposure trough a combination of risk management and small business insurance.
If you purchase your small business insurance as a package or Business Owner's Policy (BOP), you can get the coverage you need for burglary and theft claims. When you review your policy with an insurance agent, make sure you have one of these two forms of coverage:
Having to suffer through a burglary or theft claim is going to be unpleasant. It's best if you can find solutions to mitigate your exposure to this risk, it will save you money, time, and keep your business insurance rates lower in the long run.
No risk management solutions will completely eliminate all incidents of burglary or theft, there are always steps you can take to reduce your exposure. Here are seven (7) ways you can reduce these incidents:
It's easy for us to advise you to lock your doors and buy an alarm, but you should really consult a security expert. In fact, most business security experts agree small business owners should seek consultation from qualified security firms in order to find the right system for their needs.
Here are a few tips you may get from your local experts:
In the end, determining the "right" choice for your business is a combination of working with your business insurance agent and security professionals to identify your unique needs and the right mix of products that fit into your budget and provides the proper protection.
In some instances you may discover a simple solution is correct, and for others, you may require a more sophisticated and complex system. Regardless, with burglary and theft being the largest exposure most businesses have, getting the proper information and creating a strategy to combat the risk is only smart business.
Image Source: Leon Ephraim
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