You know you’re going to have a bad day when you walk into your office and find that your shop has been broken into and all your computers and lots of equipment have been stolen. After you get your heart re-started―for which you will have to utilize your company’s medical-insurance coverage―you’ll wonder whether you and everyone else followed the prescribed procedures for backing up everything on the server and the network of computers. If your employees have, the damage/loss will have been contained to the physical equipment taken, like computers, printers and scanners. If you haven’t, it’s going to be a very long day.

 　　Unfortunately, the theft of company equipment and corporate assets is a growing concern among decorated apparel, sign and digital graphics business owners. And it seems the thieves of late have been very selective in what they’ll nick. It almost seems as if they are taking orders and only stealing what their “clientele” is willing to buy. The good news for business owners with good insurance coverage from a reputable, fast-paying company is an unfortunate event shouldn’t disrupt―too badly―the normal, day-to-day flow of business.

　　So, where does one go to procure the “right amount” of insurance for a thriving, growing enterprise? What's the "sweet spot" of coverage? How many types of coverage are available, what is an absolute “must-have” and what is “nice-to-have,” if affordable? How does one go about finding a competent, trustworthy insurance agent? For a moment, I thought about calling this article “Everything you always wanted to know about business insurance, but were afraid you’d get an answer.” How about settling for knowing enough about business insurance to ask intelligent questions and get relevant, meaningful answers in order to make the best decision for your company? Sound good? Then let us proceed.

 　　Got you covered

　　Choosing the right coverage is only the first step in creating a comprehensive insurance program that is tailor-made for your business. As you attempt to grow your business, time literally is money, especially if you have occasion to temporarily shut down your operations. If anything in your shop is damaged or stolen, and you’re forced to close your doors unexpectedly, you’ll have to turn customers away. And the unfortunate truth is that, even if your doors are closed for only a short period of time or you miss a delivery date, you may lose some clients forever. And that’s a cost no one wants to face.

　　In most cases, a Basic and Broad Business Owner’s Policy is a good first step. It provides coverage for loss by fire, weather-related damage, vandalism and malicious mischief, building structure and equipment malfunction, and glass breakage. Coverage for both your building and its contents can be on an agreed value, replacement cost or actual-cash-value basis. A relatively small deductible― usually $250―applies to each property loss claim, unless otherwise specified. Valuable papers are also covered up to a limit―typically $1000―when personal property is insured. Some coverage is provided―again, with maximum limits―for personal property of others in your care, custody or control, and for your personal effects or that of your employees while located on the premises.

　　If your business is conducted in your home, make sure the insurance company is made aware of that fact. Residential insurance is normally cheaper than commercial insurance. But it is foolhardy to think you will be able to get by on residential coverage if you are operating a business on the premises. Insurance companies are experienced at writing language that excludes coverage when they aren’t given the complete picture up front but, since home-based businesses are so commonplace in today’s business world, reputable insurance companies are making fair and affordable allowances to accommodate them.

 　　You might even be able to anticipate trouble before a loss occurs. Certain damages may be avoided by just evaluating the potential risks facing your building, production floor and offices, and identifying vulnerable and trouble spots. That’s the primary role of a good insurance agent: working in partnership with loss-control safety engineering specialists to help you maintain a safe and secure business environment.

 　　Where might you find a good agent? Start with civic organizations such as your local Chamber of Commerce. Here’s also a case where you needn’t be shy about calling your competition. Not only should they be helpful―particularly if they are successful―but it gives you a good opportunity to meet them. There are plenty of businesses out there, and a great deal of time and money can be saved by working together. One note of caution: Check an insurance agent’s references and credentials carefully. Know that a smart agent is not going to give you the name of a client he’s not stood by. A call to the Better Business Bureau may uncover some useful information as well.

 　　Aren’t you special?

　　There are also Special Multi-Peril Policies available to business owners. These are umbrella-type policies that can be tailored to fit the special circumstances of a particular business. Think of it this way: If you can imagine something happening that results in some kind of loss, it can generally be insured, provided you think of it before the loss occurs.

 　　Special Form policies are more expensive than Basic and Broad Form policies, but in combination, they may prove to be your best bet, if the business can afford it. Consider the following list of business insurance options:

　　Mechanical, electrical and pressure equipment―covers you for loss to your property, reasonable extra cost to expedite repairs, and your legal liability for the property of others in your facility arising from the sudden and accidental breakdown, including explosion, of your mechanical, electrical or pressure equipment.
Property in transit―covers losses from specified causes while in the course of transit, for example, from your place of business to a customer.

　　Employee dishonesty―covers you for loss of your money, securities or other property caused by theft or fraudulent acts of employees.

　　Premises burglary―covers loss to your property other than money and securities caused by theft, evidenced by marks of forcible entry or exit, and even robbery by security personnel assigned to guard your stuff. (It happens.)
Business interruption/income insurance―pays for loss of net income plus continuing normal operating expenses and extra expense resulting from necessary interruption of your business operations.

　　Commercial general liability―covers your liability in connection with your premises and operations, products, and completed oral and written contracts.

　　Personal and advertising injury―covers your liability to others for such occurrences as libel and slander, oral and written publications that violate a person’s right to privacy, infringement of copyright, trademark, patent, title or slogan.

　　Medical payments―pays for reasonable medical expenses of others injured while on your premises, or as a result of your operations, regardless of fault.

　　Workers’ compensation insurance―covers lost wages and medical expenses that result in job-related injuries. Most states require this coverage and, most times, it can be purchased through the state at a more reasonable cost than is available from commercial insurance carriers.
 

　　The fine print

　　Be sure to read the fine print of any policy that is presented or proposed to you. In some cases, you may have limits to the amount the policy will cover and special deductibles may apply.

 　　There’s a significant difference between replacement cost and current cost. Replacement coverage is best because the insurance company is, in essence, agreeing to replace the property without regard to depreciation, wear and tear, or even the change in value of materials after you took possession. If you make an insurance claim, you are going to need proof that you, indeed, purchased it in the first place, so keep good records of your physical assets.

 　　It's a good idea to have your lawyer or legal advisor review the policy before you agree to it. And by all means, have your business-insurance policy reviewed and updated annually. Take every advantage of discount credits that lower your premiums by installing security and fire alarms, sprinkler systems, surveillance cameras and other loss-prevention systems that are suggested by your insurance carrier.

 　　Want to learn more?

　　You may have noticed I haven’t opened up the cans of worms called Term Life Insurance and Employee Medical Health Insurance. If your company is providing its employees a benefits package that includes health-care insurance, you may want to request a free, no-obligation quote that is available to members of our industry’s trade association―the Specialty Graphics Imaging Association (SGIA)― to compare coverages and costs. There is a wide range of plans that includes the Preferred Provider Organization (PPO), the Health Maintenance Organization (HMO) and Health Saving Accounts (HSA).

 　　Finally, the U.S. Small Business Administration publishes the 31-page pamphlet called the Small Business Insurance and Risk Management Guide (MP-28) from its Management Planning Series and makes it available in the form of a downloadable PDF file from its Web site (www.sbaonline.sba.gov). In it, there’s a good checklist of insurance needs, a glossary of insurance terms, and a list of other information resources that should yield answers to many of your questions. Good luck!