Commercial Insurance for Businesses

Obtaining Commercial or Business Insurance in Alberta

If you are a business owner in Alberta, commercial or business insurance is part of protecting your investment. Basic insurance protects your company’s assets and provides your business with protection against liability. Commercial or business insurance is available in a variety of forms, but usually falls under the headings of either business general liability insurance or professional liability (errors and omissions).

Commercial general liability insurance is the most basic type of business liability insurance, which covers you from third party accountability claims such as bodily injury, property damage, personal injury and defense costs of legal action, but not professional liability. Professional liability insurance covers losses to a third party as a result of errors or omissions and should be carried by business owners, practitioners and consultants who provide advice or service and who could possibly incur legal action (e.g., due to medical malpractice). In most cases, general liability is associated with accidents in the workplace, and professional liability covers errors in judgment by employees while performing their professional duties in the workplace.

When you obtain commercial or business insurance, you will want to go over your policy carefully. You will want to know what your premiums will cost each month and what factors are affecting your insurance rate. Your insurance policy(ies) should be examined at the time of receipt and regularly, at least annually, thereafter. Your insurance policy(ies) should be kept a separate file at an off-site storage location for safekeeping in the event that the on-site copy you should keep is accidentally destroyed.

What Factors Can Affect Insurance Rates?

Each industry has its own risk level that is considered by the insurance company according to business classification. Businesses with similar operations and sharing similar risks are grouped together for premium rate setting purposes. Some companies, including those involved in the manufacture, wholesale, retail and distribution of a product will also need product liability insurance. Other types of insurance that businesses may obtain, depending on the nature of the business, include auto insurance, home business insurance, alcohol liability insurance (if you sell or serve alcohol), environmental and pollution insurance, and more. By speaking with an experienced insurance broker, you will find out what type of coverage is recommended for your specific industry and you much coverage you need.

Another factor that affects insurance rate is the likelihood that you will file a claim along with the estimated cost of the claim. The risk of filing an injury claim is higher in industries such as construction, transportation, and health care and lower for those working in administration, retail or utilities. The risk of filing claims can also be specific to a business, with some companies in the same industry filing more claims than others. Having a long claim history will drive up your insurance premiums and can create a serious financial burden on your company.

Location of the business is another factor that affects insurance costs. If the business is located in the city centre where property values are higher, space is limited, population density is higher and traffic is heavier and traffic accidents are more likely, it will cost more than if your business is located in a remote suburb.

The size of your business and how rapidly you are expanding or contracting will also affect your insurance rate. You will need workers compensation insurance if you employ staff and different coverage may be needed for different types of employees at a firm with different job functions and risk levels. By contrast, self-employed individuals who operate a home-based business may need more basic insurance (e.g., for property damage and any accident claims) in addition to professional liability insurance if warranted, since home insurance does not extend to home based businesses. Regardless of the number of employees, the insurance firm will need to be updated as to who is to be covered by the business insurance as often, when changes within the company occur, business owners do not update their insurance and they can end paying insurance rates for employees who no longer work for them.

Similarly, if your business fails any relevant safety inspections or your business breaches workplace regulatory standards, there can be serious consequences to your rates, as they would likely rise in response to your higher risk. For example, a day care facility, private hospital or even an eatery that fails safety standards may not be able to stay in business unless it can meet the necessary requirements. As a business owner, you must ensure that you are in compliance with all the relevant regulatory standards for workplace health and safety. You need to promote a safe work environment and establish training programs for your employees to ensure they are well prepared for workplace risks. Investment in preventative strategies can ensure long term savings in the insurance world.

Insurance companies also consider creditworthiness of the business or the business owner in determining insurance premiums. Businesses with good credit standing are seen as trustworthy and will likely be offered better rates.

If a business is publicly traded, then director’s liability insurance is also recommended insurance. Director’s liability insurance includes loss for damages, judgments, awards, settlements and defense costs but do not include fines, taxes or penalties as these are uninsurable by law. Insurance brokers understand the unique risks related to businesses and can work to ensure that you obtain the most competitive rate available.

Speak To A Qualified Insurance Broker

If you are a business owner in the Edmonton area, a licensed insurance professional at HDF Insurance will be able to serve you. We have in-depth market knowledge and regularly deal with business and commercial coverage for our Edmonton area clients with different insurance companies. We have experience dealing with a variety of business industries.

Our experienced brokers can help you determine what type of commercial or business policy would be best suited to your needs. Further, we can help you ascertain what level of coverage your business requires. Most importantly, however, we can offer some of the most competitive commercial insurance rates in the industry. Contact us today at HDF Insurance in Edmonton to speak with a broker and obtain a competitive commercial insurance or business insurance quote.