SCORE: Keep insurance coverage current

A great investment in small business insurance protects everything you’ve done to make your business successful. However, the policy you bought when you were starting out might not be sufficient for your current needs, or the direction your company is heading. Review your insurance coverage periodically to ensure you’re truly getting the most out of your monthly payments, and that you’re prepared for all valid risks.

Start with a full assessment of your company’s insurance needs. Business insurance safeguards your property against the consequences of fire, theft, liability, and other common risks. As your business has grown, however, you may have added new services and specialized equipment that require policy endorsements or modifications.

Disaster and business interruption insurance is also becoming a must for business owners concerned about damage or a prolonged shutdown resulting from natural disasters, incidents such as a toxic spill or transportation disruption, or acts of terrorism. Though such events may be rare where your business is located, even a relatively minor event could disrupt your operations and the surrounding economy for several weeks.

Before purchasing a policy or increasing your insurance coverage, consider all the possible ways of holding down the costs. Cover the most risky and largest perils first, then work down your list of priorities. Don’t purchase coverage you don’t need, but also don’t overlook seemingly minor risks simply for the sake of saving money. If the probability is small, the premium will be too. Use a deductible as high as you feel your cash flow and savings will allow.

Making wise insurance decisions is easier when you work with a reputable and qualified broker agent or consultant. Conducting research on your own is also helpful, but a qualified professional can make an informed evaluation of your small business insurance needs, and match them with available coverage options. A search feature at, the site of the Independent Insurance Agents of America, will help you find qualified professionals in your community with special expertise in small business needs.

Note that many small business policies offer the option of adding riders as opposed to buying separate policies. That’s why purchasing all of your coverage from a single agency or broker will help reduce costs. If multiple policies are necessary, make sure they cover separate risks. Otherwise, you’ll be making unnecessary payments for what is essentially the same coverage.

To learn more about insurance issues facing your new or growing small business, contact your local chapter of the SCORE Association “Counselors to America’s Small Business.”

Hiro Hiranandani, of Wilton, is a counselor in the Fairfield County Chapter of SCORE, a nonprofit association dedicated to entrepreneur education and the formation, growth and success of small business. Information:, 203-831-0065 or