commercial insurance Archives - Page 6 of 7

Why Cyber Liability Claims Are So Costly

You have probably heard or read about something like this in the news- a large company is hacked, leading to a major data breach. For example, not too long ago, big box store Target was the victim of a hacker, and thousands of customers had their sensitive information exposed. Fortunately for big companies like Target, they are large enough to survive a cyber liability lawsuit. Unfortunately, many small businesses aren’t so lucky. In fact, more than 60% of small businesses go under within 6 months of a cyberattack. Cyber liability breaches (and claims) come with expensive legal settlements and large fines, not to mention damage to your reputation and brand. It is important to have the right cyber liability insurance policy, because recovering from a cyber security breach can drain your business’s time and money.

How Much Can Cyber Claims Cost Your Business?

a hundred dollar bill on fire, burning. — *A data breach can cost your business thousands, even millions of dollars.*

Data breaches can cost your business an enormous amount of money. There is a lot you need to do in the case of breach, which all adds up. You have to notify all of your customers whose information was affected as soon as possible (as required by state law). You must also investigate and correct the breach, which can cost a lot of money, and take months or even years. A study from the IBM/Ponemon Institute found that data breaches cost businesses $242 per stolen record on average. That means the average U.S. data breach costs more than $8 million.

The reason cyber liability claims cost so much is that they include the costs of:

Finding and repairing the cause of the breach– Hiring an expert can cost anywhere from $200 to $2,000 per hour.
Notifying customers– Contacting the affected parties can cost anywhere from $1 to $5 per notice.
Credit monitoring for affected customers for two to three years– This can cost anywhere from $10 to $30 per individual, and needs to continue for at least 2 years.
Fines or penalties
Client’s financial losses if you are sued– The average cost for legal defense is $740,000, while the average legal settlement is about $2 million.
Defense costs and legal fees

What Cyber Liability Insurance Covers

While some small business owners might think that cyber liability insurance is only necessary for big companies, this couldn’t be further from the truth. Any business, no matter the size, can be hacked, and a network failure or breach can end up costing you hundreds of thousands of dollars. Any business that operates online and handles sensitive information needs cyber liability insurance. For example, if customers use credit cards to pay for your services on your site, then you are at risk of a breach.

Cyber insurance provides protection for your business from financial losses as well as the cost of data loss to your customers. It covers:

Cyber Extortion– If a hacker accesses your database and is holding it for ransom, cyber liability insurance will help recover those losses.
Forensic Support– Your policy will cover investigation-related expenses and consultation fees.
Legal Fees– Cyber liability insurance helps pay for legal help and advice when dealing with a lawsuit brought by clients or staff.
Business Interruption– A data breach affects your day-to-day operations, which leads to additional losses of income and revenue. Cyber liability can help cover these losses.

Different Cyber Liability Insurance

There are two kinds of cyber liability coverage:

First-party cyber liability insurance covers costs from a cyberattack or data breach on your own network or systems.
Third-party cyber liability insurance protects businesses from lawsuits related to a cyber incident that affects a client.

Cyber liability insurance might seem pricey, but when considering the cost of cyber liability claims, it is a necessary expense. If you are worried about the cost, remember that there are many different plans that can be tailored to your specific business and needs. You can choose how much coverage you need and how much you can afford to spend. Most business owners add first-party cyber liability insurance coverage to their general liability policy, so you might be able to get a deal if you bundle your policies.

If you are interested in cyber liability insurance, and do not know where to start or what type of coverage you need, EZ can help. EZ.Insure understands just how important it is to protect customer’s information. We will provide you with an agent to help you find the right plan to fully cover you and protect your customers’ privacy. Your agent will compare quotes from all plans available in your area, and find the best plan at the best price. Even having the best cybersecurity does not completely eliminate the risk of a data breach, so it is best to protect your business with insurance. To get instant free quotes, simply enter your zip code in the bar above, or to speak directly to an agent, call 888-615-4893.

Common Errors & Omissions Claims

When you own a small business that offers advice or services, there’s always a risk of lawsuits due to errors and omissions. Even if you have done your job to the best of your ability, something can still go wrong. Sometimes customers just aren’t happy with your work, and they could decide to sue your business. However, a lot of errors and omissions (E&O) claims can be resolved before they become costly lawsuits. In order to prevent, or quickly resolve, any errors and omissions claims made against your business, you have to know what to expect. Here are the most common errors and omissions claims:

piece pf paper that says contract on it torn in half — *Breaking your contract can result in your customer losing money, in which they can sure you for.*

Breach of Contract

If you have a verbal or written contract with a customer, you have to adhere to that contract. If a customer suffers any financial loss due to a breach of contract on your part, they can sue to recover their financial loss. For example, if you missed a deadline to put up a website for a company you’re under contract with, they can sue you for any money that they are losing while the site isn’t up and running. The types of breach of contract include:

Anticipatory breach– a business tells the customer that they will not be fulfilling the terms of their contract
Minor breach– a business fails to live up to a small detail in the contract.
Material or fundamental breach– a breach that is extreme enough to nullify the contract completely.

Misrepresentation

One of the biggest mistakes that businesses can make is overstating their expertise, promising their clients something they cannot deliver, or not fully disclosing information. If your company misrepresents itself or doesn’t disclose information, resulting in financial or reputational loss to the customer, then you can expect a lawsuit to follow. The lawsuit will be labeled as intentional or fraudulent misrepresentation. For example, if a car dealer lies about the history of a used car and their customer later finds out their car was in an accident, this would be considered fraudulent misrepresentation.

different colored signs that says lying on them — *If you lie or even partially lie, then you can be sued for misrepresentation.*

If you’re not careful, you can be slapped with a lawsuit, no matter whether you have intentionally or unintentionally misrepresented your company. E&O misrepresentation claims can include:

Making a statement that is partially true.
Making a statement that is completely false.
Omitting details, or failing to disclose important information.

Negligence

Claims of negligence often occur when a business’ poor oversight leads to financial or even physical injury of another party. You could also be considered negligent if you communicate poorly with your customer, or if you fail to take reasonable care or control when providing your services. Even if you fully explain your prices and expected outcomes, a customer might form unrealistic expectations for your work. If you don’t meet their expectations, they might sue you.

Protecting Your Business

In order to protect your business, you should:

Create a detailed contract that both parties review and sign before work begins. Include expectations about deadlines, payments and any other agreed-upon expectations between you and the customer.
Make sure that you document everything that you’re doing so that you can prove you are getting the work done.
Always keep an open communication with your clients, especially if something goes wrong while you are under contract, or if there is a minor glitch. Prioritize honesty and transparency with your customers and let them know if you are going to miss a deadline, so you can manage expectations and work together to solve the problem.

Errors and omissions insurance is the best way to protect your company from a lawsuit and reduce the risk of losing your business because of a mistake. If you are sued, E&O insurance will pay your legal costs such as attorney’s fees, court fees, and settlement costs. As long as your policy is active at the time of the incident, you will be protected. You do not want to wait until something happens in order to be insured. Make sure that your business is fully protected in the event of an incident by speaking to an EZ agent. To find an affordable plan that gets you the most coverage with the most savings, enter your zip code in the bar above, or to speak directly to a licensed agent in your area, call 888-615-4893.

Commercial Insurance Renewal Checklist

Having commercial insurance is important for your business. The right coverage mitigates any financial risks and protects you in case of any unexpected events. To make sure that your business has adequate insurance coverage, you need to review your commercial insurance policies annually, rather than just allowing them to automatically renew. Using a business insurance renewal checklist will make it easier to assess your current needs and will make the renewal process go as smoothly as possible. You can also use a checklist to prepare you to speak with an insurance agent. An EZ agent will use the info you gather to help make sure you are fully covered, and to see if there are any discounts available.

two pages with data reports on them laying on a table next to a computer keyboard — *Review your financial statements, data, and property values.*

1. Gather Policies, Reports & Data

Before it is time to renew your commercial insurance policies, gather all your financial reports including profit and loss statements, so you can go over your real property values and locations, income generated from those properties, gross revenues, inventories and any other financial details related to your business. Any changes in your revenue affect your insurance; as revenue increases, your premiums will increase as well.

In addition to gathering all of your financial documents, you should also look at all of your insurance policies, and your workers’ compensation experience data rating sheet. Reviewing all of these documents together can help you determine if you need to lower your coverage, increase your coverage, or get rid of certain policies.

2. Review Any Changes You’ve Made to Your Business

If you have opened a new location, purchased new equipment, or updated your current building, this will affect your commercial insurance coverage. If your business has grown, then the coverage that you had from last year will not be sufficient. On the other hand, if you’ve pared down, then you might be paying for insurance that you don’t even need!

3. Review Changes To Your Staff

Have you hired any new employees? Have you lost some? Are some employees doing riskier work now than they were last year? If you’ve answered yes to any of these questions, then your current workers’ compensation coverage might need to be updated. The size of your payroll affects your workers’ compensation rate, so any time that employees join or leave your business, workers’ comp coverage levels should be adjusted. The insurance renewal process is the perfect opportunity to make sure that you have the appropriate workers’ comp coverage.

4. Check Policy Exclusions

When it is time to renew your insurance, make sure to double-check your policy exclusions to determine what events and circumstances your policies will and will not cover. Make sure that you are comfortable with these exclusions, and if you are not, speak to an EZ agent. Our agents will make sure that any particular event you want covered will be covered next year.

claims written on a blue post it note that is on top of a stack of paperwork with the word "claim form" on the top — *The less claims you have made, then the lower your rates may go down over time.*

5. Review Your Claims History

Losses and claims have a major effect on your insurance premiums. A history of claims will drive your premiums up, but if you have a clean loss history, your rates may go down over time. Assess how many claims you have made and why, and see if there is a way to prevent making them in the future. And if you have not had any claims or losses, speak to an EZ agent to see if you can get a discount on next year’s policy.

6. Choose The Right Agent

A good insurance agent will take the time to review all of these documents, statements, and changes to your company. They will also take the time to review your policies and make sure your business will be fully protected in the coming year. Even if there haven’t been any changes to your business, it is still good practice to regularly update your existing policies, and an EZ agent can check to see if there might be a better policy available to you.

Choosing the right agent is the best way to save money on your commercial insurance policies, and EZ has the best agents for the job. Our agents will assess your business’s needs and compare all available plans in your area at no cost to you. We truly care about your needs, which is why our services are always free. To get instant, accurate quotes, enter your zip code in the bar above, or to speak directly to one of our licensed agents, call 888-615-4893.

Do You Need a Certificate of Insurance?

There are lots of ways to spread the word about your business, from advertising to word of mouth to social media marketing. All of these things help to get your name out there, and tell people that you’re the best in the business. Your potential customers or clients also want to know that they can trust your services and advice. They want to know that, if anything goes wrong, you will take responsibility and make things right. Let’s take a look at what a COI is and why it is important.

What Is a Certificate Of Insurance?

piece of paper with signature and red certification circle on the bottom — *A COI is a physical or electronic document that proves you have a valid commercial insurance policy.*

If you have a car, then you have auto insurance, right? And if you have auto insurance, then you have an insurance ID card in your glove compartment. Think of a certificate of insurance as something similar. A COI is a physical or electronic document that proves you have a valid commercial insurance policy. It is a quick overview of the policy you hold, and includes:

Your name and business information
The insurance company that issued your policy
The policy number, effective date, and expiration date
The type of policy (such as general liability or professional liability)
Policy limits and deductible amounts
Additional insured, meaning anyone else who is covered under your policy

These certificates might be packed with information, but they are only one page long. This means that you can post them in your place of business, or easily show them to clients (instead of having to pull out your multi-page insurance policy).

Do I Need a COI?

If your business provides advice or services to customers or clients, then there is always the possibility for things to go wrong. A handyman might accidentally put a ladder through a window, a freelance IT tech could miss a data breach, a contractor might be overseeing a building site where someone gets injured. To protect against claims of physical injury, property damage, financial loss, or even bad advice, you

need at least one type of commercial insurance policy, and a certificate of insurance to go along with it.

Not many companies or customers want to work with a business that doesn’t have insurance, so being able to show them that piece of paper is an extremely important way to keep your business growing. If you are a contractor, then you will probably be required by the companies that hire you to show a COI. Other business owners can preemptively offer a COI to a client as a way to earn trust, get an edge on the competition, or simply show that they are professionals who take their business seriously.

How Do I Get One?

caucasian hands with one hand on laptop keyboard and the other hand holding a cell phone — *If you need certificates of insurance to give to clients, you can contact your insurance company, agent, or broker.*

Finally, there’s something fairly simple associated with your business insurance! Getting your initial certificate of insurance shouldn’t require any extra work on your part, it should be included – for free – with all of the documents you receive after purchasing your policy. If you need additional certificates to give to clients, you can contact your insurance company, agent, or broker. These additional certificates are also free and should be quick and easy to get. If you need to add your client as an “additional insured” or add extra coverage for a specific job, then it may take a few days to a few weeks to get a new COI.

When it comes to your commercial insurance, your policy should be “if you’ve got it, flaunt it.” If you’ve taken the responsible step of insuring your business, then let your customers know – and watch your business take off. If you’re shopping around for commercial insurance, or need a new plan, then EZ.Insure is the place to be. We’ll answer all of your questions, give you instant quotes, even sign you up – all for free! Don’t go another day without the policies that will get you noticed, or with a policy that’s not working for you. Get started with us by simply entering your zip code in the bar above, or speak to an agent directly by calling 888-615-4893.

Can you Cancel a Commercial Insurance Policy?

As a small business owner, you might find yourself in a situation where canceling your policy is the best solution. This comes from a variety of reasons: you have a better policy offer elsewhere, changes in your business mean you need different coverage, or you might be shifting your company’s goals altogether. Whatever your reasoning, there are a few things to consider before you cancel your insurance.

hands to cancel policy — *Think before you back out on a contract. There are more penalties than just a fee attached.*

Penalties & Changes

Often times, your insurance company will impose a penalty if you cancel it, rather than waiting to not renew. Signing the contract for your policy is to ensure you’ll pay it for the full term. It’s security for the provider.

However, if you find yourself needing to cancel, the penalty fee might actually be cheaper than trying to ride out the term or doubling up on policies. We know rising insurance rates play a part in policy changes, but here are a few things you might not know:

Comparisons between plans should be the item on the checklist. If your new plan is cheaper, note the final difference to see if canceling will actually benefit you.
If you do decide to go forward, ask for the penalty specifics from your insurance provider. Having concrete numbers to work with will help with the bottom line for your business, so you can plan for the financial changes.
Has your new insurance firm made all the final checks? Make sure you have a 100% accurate number for your premium.
Finally, check with the next company you’re signing up with. Do they have bundles to save you money? Are they easy to work with? How is their customer service team?

When you finalize and complete these items, you will have a well-rounded idea of what canceling your insurance policy will bring.

A Note on History

Like any relationship, having a history with a company could help you in the long-run. If you’ve been with a company for several years, then you’ve built trust with them. Canceling and turning to another company could spell trouble in the long run. While the policy could be cheaper, if something were to happen (like your account falls into bad-standing) then it could prove harder to recover.

For example, if you know your broker on a first-name basis, then they might help vouch for you with an underwriter for a new policy, should you find it in turmoil. Too many claims or cancelation threats from the company could be easily solved by citing your history with the company.

person talking with agent to cancel policy — *If you like your insurance agent (and trust them), it could be worth paying a little more and staying with your current policy.*

All in all, if canceling is in your future, it needs to be done with as much (maybe even more) preparation than purchasing coverage. There are many strings attached to these policies, and you need to be aware of each of them and how they’ll affect your business in the future. It could be as simple as an added fee, but if you don’t check it out, you could be saddled with hefty premiums in the future.

EZ.Insure can give you the help you need to make the best decisions for your business. Your agent will answer any questions you have, compare different plans for you, and even sign you up when you’re ready, free of charge and without having to worry about being hounded by endless calls. To get started simply enter your zip code in the bar above, or you can speak to an agent by emailing [email protected] or calling 888-350-1890. EZ.Insure makes the entire process easy, and quick.

The Beginner’s Guide to Professional Liability Insurance

If you sell products or provide services, you need professional liability. Your business can only benefit from this coverage.

Here, we’ll take a look at what Professional Liability covers, real-life examples, and costs.

business owner looking at professional liability coverage — *Running a company is difficult, but professional liability will bring peace of mind.*

What is Professional Liability?

This policy is often called “Errors and Omissions,” so if you see either, know they mean the same thing. Businesses need protection from professional mistakes, and this insurance type offers just that.

The worst-case scenario is a negligence lawsuit against your company. But, with this policy, you’ll be covered! A Professional Liability plan will help cover all costs and fees associated with the lawsuit, this includes legal fees and damages you have to pay. For businesses offering things like advice or services, it comes with the territory. An example of this would be a construction worker who is sued because a wall he built fell during a storm and the customer believes it was because of the companies negligence. A lawsuit like this has the ability to shut down a small business, but with professional liability, they would be covered!

This policy brings peace of mind, knowing that should unforeseen circumstances take place, you’ll be safe from the negative effects lawsuits bring to your company.

What is Covered?

While there could be exceptions, these are the typical circumstances covered by professional liability:

Business Mistakes– If your client incurs losses, and your business is at fault, then the financial costs will be covered.
Legal Costs – Should a lawsuit come your way, your company won’t have to pay the court fees or otherwise. This is regardless of the court’s decision.
Negligence– Should you incur a lawsuit due to failing to meet a client’s standards, then you are covered.

You might think these don’t apply to your business, but reading further will give you a better perspective.

Real-World Examples

Example: Let’s say you’ve been contracted to clean office space for a client. Your staff was sent out, but the client calls back, complaining that the work was unsatisfactory. To make matters worse, the client purchased the cleaning before a work event, so they are blaming the loss of the event on your company. Then comes the lawsuit.

Now, this example seems unfair, but even in an unfair case, you’ll still be charged several thousand dollars in legal fees. Do you really want that for your company?

man arguing on a call with headset — *Lawsuits come to even the best prepared. Liability can help recover when this happens.*

Example: You’ve performed surgery on someone but made a small medical mistake resulting in calling the patient back. The results are what you’d expect. While this mistake is human, it could cost you heavily in a negligence lawsuit. These range into over $100,000, especially with medical cases.

Example: Your business has a contract with another for financial advice, and you were confident that your advice would increase their profit margins, but it didn’t.

Now, the other company is suing you to make up for their own profit losses. Think this situation doesn’t apply to you? It can be any type of undelivered service. If you are promising something, simple human error or bad luck can intervene.

What Are the Costs?

Thankfully, professional liability is a less expensive option. However, you do want to keep continuous coverage to reap the benefits mentioned above.

For the average small business, professional liability will cost between $60-$80 a month–around $700 a year. This, of course, can be even less if the business is low-risk. If you run a high-risk business like construction, the costs can rise to nearly $2000 a year.

office table with plants, phone, and notebook for professional liability — *EZ.Insure is designed simply to get you access to the best coverage.*

Purchasing professional liability is easy enough, especially with an agent on your side. They will have the most up to date information about what level of coverage your company really needs to keep you safe–without overspending.

EZ.Insure is here to help. Your agent will answer any questions you have, compare different plans for you, and even sign you up when you’re ready, free of charge and without having to worry about being hounded by endless calls. To get started simply enter your zip code in the bar above, or you can speak to an agent by emailing [email protected], or calling 888-350-1890. EZ.Insure makes the entire process easy, and quick.

At EZ.Insure, we know that starting a business can be overwhelming, so we’re putting together an easy series for reference. If you need more information, see our Business Insurance Masterlist and our Group Insurance Guide.

Tag: commercial insurance