The new year is ideal for landscapers and nursery owners to review their insurance policies. Over the past 12 months, your business might have celebrated exciting new milestones that could impact your insurance needs. Annually checking on your insurance policies is crucial to ensuring your business is properly protected in the event of a claim.
Why You Should Review Your Policies Regularly
Insurance is a powerful risk-sharing tool that helps protect policyholders from the financial impact of unexpected losses. As a business owner, you hold insurance to protect you from the unexpected costs of running a business. However, as your business evolves, so too do your risks, causing your insurance needs to change.
By remaining aware of the factors that can impact your insurance coverage, you can ensure you’re always carrying the proper amount of coverage. These can include:
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Moving to a new property or modifying your business premises – Insurance rates are calculated using the unique risk exposures associated with your building type, geographic location and other factors. Making alterations to the building or relocating, even if it’s just across town, requires changes to your commercial property insurance.
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Welcoming new employees to the team – New employees represent an exciting time for your business, illustrating your company’s growth and success. Aside from the standard orientation and onboarding process, they also require adjustments to employee benefits, workers’ compensation insurance and commercial auto insurance policies.
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Adding new products and services – Landscaping businesses that strictly offer lawn care, such as mowing and edging, will have different liability exposures than businesses providing a broad portfolio of services. If you added a new service, especially one associated with dangerous equipment or chemicals, your liability needs have changed.
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Making a significant purchase – Landscaping and nursery equipment can be expensive, necessitating commercial property or auto insurance adjustments. If these big-ticket items become damaged or break down, they can cause major disruptions to your business and bottom line.
These changes can be exciting, representing powerful growth opportunities for your business. However, failing to account for your changing risk exposures can result in your business becoming underinsured, a costly and stressful situation where your insurance policy doesn’t have enough coverage to pay out the total cost of the claim. In that situation, you’d have to rely on your savings to make your business whole in the event of a loss. This devastating situation could result in bankruptcy and the shuttering of your business if you’re not adequately protected.
Which Policies Should You Review
In a perfect world, you and your insurance advisor would review all your insurance policies annually. However, if you’re looking to prioritize your time, focus on these five:
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Commercial property insurance – Designed to help protect the costly physical assets of your business against loss, commercial property insurance is a valuable policy that helps safeguard your owned or rented building against costly incidents like fire, storms, theft and vandalism. These policies often cover the materials inside, such as your heavy tools and equipment. If you leased more space, moved to a new building or made a significant equipment purchase last year, your coverage needs likely have changed.
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Commercial auto insurance – Your business relies on a fleet of trucks and smaller vehicles to get your employees and equipment to the workplace. Because your business requires the regular transportation of goods and people, holding a commercial auto insurance policy is essential. A commercial auto insurance policy safeguards your bottom line against injuries or damages your employees may cause to other people and their property. It can also include coverage for different situations, such as if an employee uses their vehicle for work or if you need a rental car. If you added to your fleet this year or sold off stock, you must check your policies to ensure you’re properly covered.
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General liability insurance – As a landscaper, most of the services you provide occur at customers' homes and businesses. Because of this, third-party injuries and property damage claims can pile up and potentially harm your bottom line. With general liability insurance, you can get financial assistance in the event of a claim or lawsuit, covering necessary medical bills and paying legal expenses. You need to update your policy if you recently added products or services to your landscaping or nursery business that could enhance your liability exposures, such as tree trimming.
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Workers’ compensation – Working as a landscaper or nursery employee is physically demanding, requiring heavy materials, tools and chemicals. No matter how careful your employees are, there’s always the possibility that one of them could be hospitalized from a work-related injury or illness. Workers’ compensation insurance protects your business by covering employee expenses arising from these incidents, such as medical bills, lost wages and ongoing care costs. Adding new employees or downsizing staff can affect your coverage needs.
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Business owner’s policy (BOP) – Many business owners bundle their insurance coverages into one cohesive package to simplify the buying process and save money. While they commonly combine business property and liability insurance, BOP policies can include optional coverages to tackle additional business risks. Because these policies are heavily personalized, it’s vital to update them if your business undergoes any changes.
Shopping for insurance can be stressful and confusing, but running your business without the proper coverage can lead to more significant issues, such as bankruptcy after a substantial loss due to being underinsured. By following our tips and reviewing your insurance policies annually, you can secure powerful peace of mind and start the new year on the right foot. Contact MNLA’s insurance expert, Ashley Thomas, for a free risk analysis to ensure your business is properly insured against your unique exposures. Learn more about available coverage at gallagheraffinity.com/MNLA or contact Ashley Thomas of Gallagher Affinity at 918.764.1619 or ashley_thomas@ajg.com for a coverage review.
The information contained herein is offered as insurance Industry insight and provided as an overview of current market risks and available coverages and is intended for discussion purposes only. This publication is not intended to offer legal advice or client specific risk management advice. Any description of insurance coverages is not meant to interpret specific coverages that your company may already have in place or that may be generally available. General insurance descriptions contained herein do not include complete Insurance policy definitions, terms and/or conditions, and should not be relied on for coverage interpretation. Actual insurance policies must always be consulted for full coverage details and analysis. Insurance brokerage and related services to be provided by Gallagher Affinity Insurance Services, Inc. (License No. 100310679 | CA License No. 0783129).
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