All security companies need insurance coverage for armed security guards. There is a lot that can go wrong over the course of security work, and you want to protect your business against any lawsuits that come up. This is particularly vital for smaller businesses that may not have the funds necessary to fight a lawsuit effectively. Here are some of the biggest mistakes you want to avoid when buying a new insurance policy.
Buying the Cheapest Policy You Can Find
Many business owners want to save money on whatever they can. However, you can never settle for cheap insurance that will not actually protect you. You need to understand the policy inside and out, so you know you are getting all the protections your company may eventually need.
Skipping Essential Coverages
Every business needs liability insurance. Outside of that, there are numerous additional policies that are optional but you still should get for your company, such as these:
- Errors & omission policy
- Security guard dog insurance
- Cyber insurance policy
- Umbrella policy
- Business interruption insurance
Failing To Look at Your Credit Score Before Applying
You do not want to find out your security agency has a low credit score after you have applied for insurance. Insurance companies take an array of factors into consideration when determining how much you pay, including your credit report. It is a good idea to be proactive about building up your score as much as possible beforehand. Pay your bills on time and fix any mistakes to the best of your ability to increase your score.
Not Utilizing IRS Code Section 162
Section 162 permits an executive bonus plan. This is a fringe benefit you fund through life insurance, and it can be provided to a key group of business owners and valuable employees. It provides an immense amount of protection to the executive’s family during his or her working years. It can provide supplemental retirement income you seriously need to take advantage of if you are eligible.
Failing To Update Insurance as the Business Develops
Plenty of business owners purchase an insurance policy initially and then forget about it. When it comes time to renew, it seems simple enough. However, you need to consider all the changes your company has gone through in the past year. As your business gets bigger, you often have to alter your protections. You need to reassess to determine how much coverage you need. You may have bought the policy when your company made a certain amount of money every year, but now the revenue has doubled or tripled. You need an insurance policy based on your company’s current standings.
There are plenty of mistakes you can make as a security company business owner that can easily be corrected. Unfortunately, when it comes to insurance, one mistake can tank your business quickly. You should take a look at your insurance coverage for armed security guards today to see if there are any areas that are lacking. By fixing it now, you can save yourself a ton of hassle in the future.
