This is a tough and challenging economy for many businesses. You may be like many business owners and cutting back on expenses. Unfortunately, insurance may be one of them. Don't make that mistake.

According to a recent report I read in American Agent & Broker magazine in March, 59% of agents and brokers responding to a survey indicated that their commercial clients were cutting back on insurance. The same held true for personal insurance, too. The Insurance Research Council projects that underinsured motorists on the nation's highways will increase from 13.7% in 2007 to 16.1% in 2010.

You might be saying, "Dan, I can't afford to be insurance poor. In this economy, I've got to be smart." Smart is actually not cutting back on insurance. It may actually mean increasing it!

Consider how much it will hurt if you have an uncovered loss today because you were trying to cut costs. Are you willing to tolerate that kind of risk?

The most obvious scenarios play out in the least known areas. Consider these examples...

• You choose to go without Employment Practices Liability to save money. An employee sues for wrongful termination or age discrimination after you had to reduce your work force. You may be in the right, but who's going to pay for your defense costs? Who pays if the judge sides with your former employee? The answer is you without insurance.
• You decide to drop your Commercial Umbrella policy this year to cut costs. What are the chances you will have a catastrophic loss anyway, right? The next week your driver plows into another car and permanently disables the other driver. Estimated costs are well over the $1,000,000 auto policy you hold. Your umbrella would have been enough to cover the remaining costs. Was it worth it?
• You decide to intentionally underinsure your property to save money. You tell your agent your inventory is down and give a low value. You suffer a partial loss to property due to a fire. When the insurance adjuster is done counting every lead pencil, you learn that you are being assessed a coinsurance penalty for being underinsured. Even though your policy had enough to cover the claim, you didn't understand the conditions of your policy and got burned (pardon the pun).

Okay, I hope you get my point. You shouldn't cut back on insurance. You might even have to pay more to cover that Employment Practices Liability or Umbrella policy. So how can you offset the cost and better manage your risk? Here are a few suggestions...

• Increase your deductibles. Most businesses have way too low deductibles. Raise them as high as you feel you can go.
• Determine which commercial vehicles don't need physical damage. Often, vehicles over 10 years old aren't worth what you are paying extra premiums for on the comprehensive and collision. Delete this coverage for the ones that it makes sense for cutting.
• Make sure you understand clearly your liability rating basis. If you estimate too high, you will overpay during the year. Yes, you may eventually get it back, but that's no good for cash flow.
• If you haven't recently, bid out your insurance. Your agent may be great but he or she don't represent every insurer. Do your due diligence and check the market. It's still soft (premiums low) and won't stay that way forever.

Don't be penny wise and pound-foolish. Find areas in your business to cut that make sense. Don't jeopardize all you've worked for by slashing your insurance coverage. If you commit to managing your insurance smarter, you will ultimately save money without sacrificing protection.



Article Source: http://EzineArticles.com/?expert=Dan_Weedin

Ever heard of an insurance score? Most people haven't. Let me explain what it is and give you some ideas on how to improve this number.

Naturally it has to do with tickets and accidents and unlike the DMV (tickets fall off every year), some companies go back as far as ten years, some seven or five, even as short as three. An insurance score includes: payment history, bankruptcy, foreclosures and collection activity, length of credit history, amount of outstanding debt in relation to credit limits, types of credit in use, and number of new applications for credit.

Your insurance score also has a relation to your credit. The argument being that insurance is a form of credit as the consumer pays a monthly premium and can end up with multiple large bills after proven liable.

Something you do today can follow you for the next five years (or longer) as many of us already know.

With insurance scoring it only goes to show, an individual, as well as the industry, can benefit from everyone driving slower and having compassion for fellow commuters.

Lower premiums are an option but the consumer has to take the initial steps. Remember, insurance companies are pooling risks. That's me, you, and the neighbor: if the rating class we're in has substantial losses we're all in for a rate increase.

Lets slow down a little and pay a more attention to driving instead of the phone or make up or whatever it might be. You could find yourself with a lower premium as a result.

TEN TIPS FOR IMPROVING YOUR INSURANCE SCORE:

1. PAY YOUR BILLS ON TIME.
2. Paying your bills on time improves your score. MANAGE YOUR OUTSTANDING BALANCES.
3. As a rule of thumb, maintain account balances at least 75% below your available credit. AVOID EXCESSIVE INQUIRIES TO YOUR CREDIT REPORT
4. Too many inquiries may negatively impact your score. LIMIT THE NUMBER OF CREDIT ACCOUNTS.
5. Your access to excessive unused credit could result in too much debt. REVIEW YOUR CREDIT REPORT REGULARLY.
6. Know what is on your credit report and take necessary steps to dispute any inaccuracies. AVOID "QUICK" CREDIT FIXES.
7. Good credit is built over time. MANAGE YOUR DEBT CONSOLIDATION.
8. Consider how to effectively pay down your debt without generating more credit activity. LIMIT THE AMOUNT OF NEW DEBT YOU TAKE ON.
9. Too many new loans or credit accounts opened in a short amount of time can negatively affect your credit rating. ESTABLISH CREDIT IF YOU DO NOT HAVE A LONG TRACK RECORD.
10. A longer credit history has a positive impact on your score. WORK WITH YOUR CREDITORS.
Resolve outstanding balances before they are turned over to a debt collector.



Article Source: http://EzineArticles.com/?expert=Carson_Koziol

The cost of insurance is rising all the time and many people are now starting to wonder if it is actually one of life's necessities. There are many different types of insurance and it can be expensive to cover everything that only has a slight chance of happening. Unfortunately though we cannot guarantee nothing bad will happen to us, our families or our belongings! There are still plenty of good reasons for taking out those insurance policies.

1. You never know what is going to happen. This is the main reason for having insurance. If you are covered and someone breaks in to your home and steals something you get it replaced, if you break your hip you get it replaced etc. This is how insurance should work.
2. You can't trust nature - In early 2009 bush fires ravaged the southern Australian state of Victoria destroying over 1000 homes (not to mention vehicles and possessions). This is but one example of the destructive forces of nature. Add storms, hurricanes, tornadoes, earthquakes, tsunamis, floods etc. into the mix and it becomes very clear that insurance is still very necessary!
3. You can't trust other people - Accidents happen to everyone, but there are people who cause accidents through negligence, a drunk driver for example. Not being insured doesn't mean you can't sue them, but at least you are covered from the start!
4. It's not as expensive as you might think - Insurance plans can seem expensive, but there are always ways to save money, like bundling different types of insurance together for example.
5. For your peace of mind - Knowing that you (and your family) are covered by an insurance policy if something unfortunate does happen can help put your mind at ease.


Article Source: http://EzineArticles.com/?expert=Phillip_Darcy