In's and Out's of Small Business Insurance for NOOBS. 4 k video

that particular business owner chooses to shop it every year so he's not doing himself any good so the business order or you tell me doesn't even know that the different insurance companies out there start to look at at the tire kickers yes angle we don't want this guy correct and so so by shopping every three years you can still get the best price but not get thrown into the sandbox yes so to speak hundred percent okay so that's a good thing cuz there's guys out there shopping every year and they're actually hurting themselves yeah sometimes I always say I have said to some of my some of my clients actually so I need to save you from yourself because you you're destroying yourself at the marketplace I mean nobody really wants to write your accountant speaking of that you've analyzed enough businesses out there what are the common mistakes you see businesses make when they're buying insurance if you don't have a work comp policy in place and you have an employee you will get fine they will make examples audience is there any advantage to go into an independent broker like you or agent like you versus someone that is a captive agent or assigned to one single cut but definitely I would I would definitely say yes to that just because I have more options I mean options are good I don't know how you could argue this all right you guys today's video is not going to be the most exciting but hopefully it's going to be helpful insurance can be one of those things where you don't really get to play with a tangible object it's no heavy equipment it's not exciting but it's mandatory and a lot of guys are trying to skip it a lot of guys are trying to cheat it and a lot of guys are getting caught busted and hurting themselves and so today instead of making a painful process we're gonna meet with my insurance agent we're gonna try to figure out what you absolutely have to have and what are some of the things that other insurance agents out there might be trying to sell you that's fluff and just padding their own pocketbooks today's video is sponsored by a company called LM and software and it's a company that I've started to work with and started to implement on my own and I want to give a big shout out and thank you to those guys it's something that I feel very confident recommending to you so if you are in the market for software do me a favor go check them guys out because without their help videos like this which may not be the most exciting but are still pretty helpful to the right people and without wasting more time let's get together with my insurance agent let's learn some stuff and let's go from there and please tell me what you think of this video in the comments down below and let's just get into it all right guys today we're gonna be talking commercial insurance we're gonna be going over very clearly so if you're brand new to a business you're just getting started Jeff is my insurance agent he's gonna help us break down and understand piece by piece what all the different languages inside of insurance and then Jeff you've promised to talk us through a few things that contractors and small business owners need to watch out for these red flags that an insurance agent may come in and say hey we want to insure you for this and really what they're doing is they're insuring their own pocketbook and it's not in the business owners best interest because it's just costing them money when maybe they could save some money is that the plan today yeah that's a good plan I don't know how many red flags I can come up with but I think I can give you a general overview of what's needed and maybe what's not needed there might be some fat on the bone that you just don't have to have or or just understanding how the insurance works will help to make you make better decisions so the back story is Jeff is my insurance agent we're gonna give you his name and number if you guys want want to be covered but Jeff I remember when I came to you you save me almost thirty 40 percent from where my prior insurance was and gave me all of the same coverage so there are ways to trim that fat but let's dive right into the to the language of insurance so guys can understand what is liability what is all these different things and the differences between commercial insurance and what these guys think they're covered when they go out and put coverage on their truck and they go out and do a job they need to understand they're not covered they're not covered whatever vehicle insurance does not cover general business practices and we need to make sure that these guys are safe so why don't they go ahead and jump right into it you know I'll give you kind of the one-on-one if I can to start out with we'll start right away with you you own a small business if you own a small business whether it's contracting whether it's retail whatever we start with property insurance you know what the key is is to look at what the the proper limit would be and that's not related to market value it's related to the cost of construction and every year you know there's inflationary issues whether it's the material and/or the labor that continues to increase so buildings have to be looked at each year so you kind of start with your buildings if you own them and/or if you're required if you're leasing a man you're required to insure them you want to get a proper limit on there so now you've got that's one division under a general umbrella for a business right buildings are one equipment is another one for contractors then the general business practice itself is a third one and is that where the umbrella policy comes in because we need to cover yeah well let me clarify the word umbrella I don't want to use it to loosely it's basically an excess policy so what you have is you have your property insurance that's on its own and then you have something called inland marine coverage and that covers your equipment when it leaves that premise so when it's in transit when it's at a job site when it's awaiting installation of the job site things of that nature and I'll get a little more specific on that and then you have general liability general liability is probably the the biggest portion of the policy because you typically have to have it especially a contractor has to have it and if your retail you're gonna need it for your product and or just to be on the same pan define general liability for me and what does it do and cover so these guys absolutely know when you're talking generally the exact same thing you bet so general liability is that covers your business for any property damage or bodily injury that your product or your premise causes so when we talk about a premise if I come onto your premise and you own a lumberyard or a small hardware store and I slip and fall that's gonna fall under your liability you're liable for me or any customer that comes on to your premise liability covers everything when it leaves your property insurance covers everything while it's in-house and hung over it so then where does the umbrella come in and yell uncle always infatuated with that yeah yeah and let's take it one step further stand so we have the property we have the liability and then we just have a few vehicles we might have a fleet of vehicles ten vehicles we may have one vehicle but we have we have employees that use their vehicles sometimes during work you can have this ad this endorsement for about a hundred and seventy-five dollars a year called hired and non Don and that coverage comes into play for a vehicle that you hire or you don't own it the business doesn't own it if you have an employee that runs errands for you during the day and they run an errand and they're using their vehicle and lo and behold they are texting while driving and they smoke somebody in a in a crosswalk and that particular employers great employee does not have insurance they lapse their policy accidentally or intentionally but it is your employee and they don't have any insurance and maybe there's a fatality or a very large injury with that person on the crosswalk you have something called hired or non don't auto I would recommend that on your policy if you don't have a fleet of vehicles because now you're protected because somehow someway they're gonna figure out that that employee was working on your behalf and so they're gonna litigate against you they're gonna litigate against your business rep because you are and whenever somebody is going to sue another person from experience talking to other businesses Jeff one of the things they do as soon as they find out that it was on business situation the numbers just got to true her going up the road they go for the big bucks the jugular on small business owners that they do span and basically you know they call that looking for deep pockets okay because the business typically has stronger insurance limits so one of the rules is to shop your insurance but don't shop at every single year you shop it every three years things have changed in our world so you want to stay on top of that and make sure you're not complacent your agent is is okay so why every three years yeah well instead of shopping it every year I look at our industry as a small town because you know you typically only have so many insurance companies out there that will in effect write a certain class of business so if I send your your risk to the marketplace every year because you're demanding it because you want the best price every year and you move every time on price if you do that and some people choose to operate that way yeah the problem is is when you're going to market then the insurance companies have seen your risk they're not feeling like they're gonna get your business they don't work very hard to earn it they go I can't tell you how many times in the 33 years I've been doing this where they say you know what we've seen this every year we're gonna pass we're gonna decline they flat-out will not open up that file pass the name of the business because that particular business owner chooses to shop it every year so he's not doing himself any good so the business order or you tell me doesn't even know that the different insurance companies out there start to look at at the tire kickers yes angle we don't want this guy correct and so so by shopping every three years you can still get the best price but not get thrown into the sandbox yes so to speak hundred percent okay so that's a good link cuz there's guys out there shopping every year and they're actually hurting themselves yeah sometimes like I always say I have said to some of my some of my clients I so I need to save you from yourself because you you're destroying yourself at the marketplace I mean nobody really wants to write your account because they feel like if they write it one year and they have a bad year they're gonna lose you the next year and even if they have a good year they might lose you so there Doyle T is pretty big in the industry and it it is like a small town and they really manage that and good to know yeah thanks let's move on to the next point so I'll back up here again we're kind of moving forward we got property we got liability yep we have inland marine I'm kind of just touching on these areas of coverage and we have auto ok well on your liability you typically have 1 million per occurrence okay so 1 million per occurrence takes care of anything any bodily injury or property damage that you might do the business might do the auto typically has 1 million of liability and you asked earlier about an umbrella all the umbrella does span is it goes over the top it creates additional limits and it sits over the top look at it like an umbrella and you have liability underneath it you have auto underneath it and if you have work comp you have work comp employers liability under it as well okay so it takes care of three areas it just increases all those limits an additional million two million whatever your umbrella is it's typically a minimum of 1 million and it sits over the top of a million so you'd have 2 million 2 million 2 million and so on and so forth so umbrellas are highly recommended if you have a need out there with a large fleet a lot of times the fleet or the autos are your big biggest exposure when it comes to litigation they could cause the most damage so you want to be sensitive to that but back to selling a little bit too much maybe some agents are found guilty of selling too much limit you don't really need 10 million if you have one vehicle and very little liability exposure whereas if you have a fleet of 30 or 40 now you might have a larger need for more umbrella more excess you know because their exposure is out there the bigger your company is the bigger the if I'm get if I'm hearing this right Jeff figure your company is the bigger your potential bullseye is on your back and so then if something does happen of course you have more risk out there because you have more people and the play the fact of the matter is the more feet that are outside of the door the more likely something is to happen there's a hundred percent right so then you take the risk of getting a larger lawsuit so that's when you'd want to have a larger umbrella and necessarily you don't need it if you're a smaller company yeah is that would that be a good rule if I think so I think so you you just need to be careful I've seen it where I've come in on a business that I don't work with but then they allow me a chance to look at their coverages and I see they don't have an umbrella and I'm thinking boy you could use an umbrella and or vice versa speaking of that you've analyzed enough businesses out there what are the common mistakes you see businesses make when they're buying insurance I would say sometimes too small and adaptable zhh just because paying higher premiums it's not always a huge difference with deductibles going from a smaller to a larger but sometimes just the very small deductibles on buildings you know the odds of ever having a problem are very rare in the first place and a lot of this this is an intangible product a lot of this stuff you may never use in your lifetime but it's really not the purpose of it it's if you ever do need it you you want to have the right coverage in place so you just continue on it's like the law of indemnity you just go you know the insurance isn't supposed to make any any better or any worse it's supposed to keep you going to slake yar today with no loss and tomorrow if you have a big devastating loss you're still sitting here and and your financial situation really doesn't change much because you're properly insured okay so we were talking a little bit more about getting to in debt in bed with one company what I mean that's kind of like what we were talking about next to that point there I think you need to caution yourself or or be aware of it anyway that you know if you are with an insurance company for you know let's just say 10 to 15 years and and you've never taken any other options but you've just stayed there it's been comfortable they've paid their claims like they told you they would it's it's a good it's a good situation but I will caution you at the same time you're probably paying more premium than you would if you were to maybe take a look at other carriers after 10 or 15 years you could probably save quite a bit of premium is is there any advantage to go into an independent broker like you or agent like you versus someone that is a captive agent or assigned to one single Cutler definitely I would I would definitely say yes to that just because I have more options I mean options are good I don't know how you could argue that one insurance company they offer this they offer that but when I'm dealing with 20 30 different ones I know that I can probably have an advantage over the captive if you give me that opportunity okay every once in a while the captive will have the best deal in town it's just the way the captives working they here but out of a ten year stretch where the captive and I battle every year I get nine out of ten or eight out of ten or seven out of ten I would say my advantage percentage-wise is much greater than the captive and there's nothing against the captives then they're beautiful insurance companies but I'm just saying from a premium standpoint I think the independent has much greater advantages no we talked we haven't talked much about workman's comp now I know there's different rates in workman's comp for different positions inside of industries for instance like in the landscaping trade any time a guy has run in a certain piece of equipment I know that if a percentage of that time he's running a piece of a different kind of piece of equipment I may get charged more I may have to pay more into workman's comp because they're running this piece of equipment or if they run something else over here my charge rate may be a lot lower what what are just walk us through some of the things I want these guys to walk away feeling comfortable when they go to meet with their agent what they should be looking for in ways that they can cut their own bills down so that they can get it within you know a reasonable amount yeah well the good news bad news with workers comp it's highly regulated it's very structured in the class codes so for instance the the cheapest rate of all is what we call clerical so if you just have office people they're not using vehicles during the day they're just they're just pushing paper that's a cheap rate let's say 30 cents per hundred of every payroll that they do now you got a guy that might be a roofing contractor and you know he's up on roofs of heights of whatever now his rates gonna be much higher the key with workers comp is you have to have a policy if you're an employer and have a minimum work comp policy it's in place because the Department of Commerce's will make an example out of employers small businesses would be the ones that typically get hit with this if you don't have a work policy in place and you have an employee you will get fine they will make examples idea we've had many discussions about this with people that work for the Department of Commerce and also lost control people with you know they hunt for the small business owner they would if somebody were to you know say hey I work for ABC company and I know he didn't pay work comp on me and I got injured once and he paid me out of pocket that kind of stuff it might feel good at the time if you have an employee but then selected enemies you can come into play pretty quick if somebody gets hurt bad because there's no benefits there for that employee even if they're best friends with the business owner and the business and they agreed that's okay you don't have to cover me you've got to have absolutely got a hundred percent that would be one of my cardinal rules quick question for you Jeff if guys got more questions or they want to have you analyze their business can they reach out to you then absolutely absolutely how would they do yeah and Jeff molt mo 80 at North risk partners and I have an email Jeff dot mote mo 80 at North risk partners comm North risk partners comm that's all one word do you want to put a phone number I will seven okay two five one seven one six nine that's my cell number that's all I work with I mean are you sure you want that a hundred percent one hundred percent yeah you've got don't take advantage of that no midnight calls what are the number again 507 up to five one seven one six nine all right don't swamp him because he's my insurance agent and I still need him to handle my stuff because you said when you shop for insurance policies we were with Grinnell we were with West Bend we were with I don't even know and every year we look at all the coverages and every year you're analyzing to see who's gotten the best and applying not just the…