Insurance is essential to protect you and your small business in case of a disaster like fire, theft, accident, etc. In today's litigious society, insurance protects also you if you or your business is sued. You must get an appropriate amount of insurance to cover yourself and your business. Remember, insurance is expensive. Premiums can add up quickly. Following tips ensure you get the most bang for your buck while buying insurance:



Learn about insurance. I am not saying that you should become an expert in the field of insurance but you should know various types of insurances that are available in the market and what does each cover. For example if you are buying life insurance, do your research online first. Know the difference between term life policy and whole life policy before you talk to the insurance agent. This will help not only save you money but help make a decision that suits your needs the best.

Create your own insurance estimate. If you know what you need, you will be in a better position to evaluate your options. Calculate –

-> How much you would need if you workshop and inventory is destroyed by fire or flood?

-> What would be the cost of replacing the equipment and inventory?

->How long will you be unable to sell i.e. losing money? How much is this time worth

-> How much life insurance should you carry to ensure that you family can get back on its feet in case something happens to you?

-> How much disability insurance do you need?

This will give you a rough estimate of you insurance needs. You may even hire an independent appraiser to appraise you business. This is particularly helpful if you have expensive equipment used in you craft.

Shop around before you buy insurance. Talk to three or four insurance agents. Get their suggestions as to what and how much insurance you should buy. Get insurance estimates. Once you have all the information, compare notes. Compare what you thought you needed and what the agents have suggested. Find out where you get the best value. Make your decision accordingly.

You may get favorable insurance rates if you are a member of small business association in your area. Call your local chamber of commerce or other small business association to find out. The memberships for these local organization cost little to no money.

Buy only minimum amount of insurance you at the time of start-up. Re-evaluate you needs at the end of a three or a six-month period. Depending on how your business is doing, you may want to buy additional insurance. You must reevaluate your insurance needs at least once a year i.e. at renewal time. You can change to your policy without any extra charge and make certain that you are well protected.

If your spouse is employed in a company that offers health insurance, get health insurance for the family through him or her. Group health insurance rates are often more favorable as compared to individual insurance rates or insurance rates offered to small businesses.