The top and bottom lines always matter. When you run or operate a company, the cost of doing business and yielding a profit is always on your mind.
It’s no secret that making money costs money and running a business isn’t easy. Lots of costs can impact how much it costs to run your business, including:
- New legislation
- Changing tax codes
- Forced increases to minimum wage
- Rising hydro prices
- USMCA aka United States-Mexico-Canada Agreement concerns (formerly known as NAFTA)
- Lack of available talent
- Rising material costs and other elements.
All of these pressures, combined with normal competition, create a challenging environment where business owners need to focus on costs and cost reductions.
We’ve prepared this post to discuss reducing your business insurance costs and clarify what coverages are essential when looking for cost-cutting opportunities.
How to Reduce the Cost of Business Insurance in Canada
Costs matter, both when the economic forecast isn’t great and when things are running smoothly. As a business owner or operator, regular cost reviews are a part of your due diligence.
Below, we’ve listed three ways to reduce the cost of business insurance for your Canadian operations. Keep reading further to learn about how our clients manage costs with ALIGNED premium financing.
1. Increase Deductibles
One of the most common ways to decrease commercial insurance costs is to increase deductibles or self-insured retentions.
Deductibles and self-insured retentions are the portion of an insurance claim that the insured pays themselves. They are an important factor in the pricing of business insurance. The higher the deductible or self-insured retention, the less likely the insurance company will have to pay a claim and/or the less of a claim they will have to pay.
Because an insurer is less likely to have to pay a claim and/or pay less for a claim, the rate calculated for your business insurance can be decreased.
2. Reassess Your Business Insurance Coverage
Another practical response to “How do we decrease our business insurance costs?” is simply to buy less insurance.
There are several ways to do this, such as:
- Decreasing your overall limit
- Reducing or eliminating various extensions and sub-limits in your insurance policy that you don’t want and/or value
- Buying less commercial insurance to reduce business insurance costs
Also, did you know that many business insurance policies are prepackaged? This means that if you want to reduce business insurance costs, there may be coverages that can be deleted if they are no longer desired or valued.
An ALIGNED insurance broker can help audit your current insurance policy and uncover potential areas for cost savings. We can also help you reassess your current insurance needs and change your business insurance coverage.
When you’re ready to reduce the cost of business insurance, our commercial insurance experts can help you uncover cost savings.
3. Work Directly With An Insurance Broker in Canada
Finding an insurance company that specializes in your Canadian industry or offers products and services that support your specific needs can be time-consuming.
However, when you work with an insurance brokerage like ALIGNED Insurance, you can feel confident knowing you’re working with brokers who know the insurance marketplace, have a clear idea of what’s available, and what specific products and services best align with your business.
At ALIGNED, our core value is helping others. Our President and CEO, Andrew Clark, founded ALIGNED because of his desire to help others as he’d been helped by the insurance industry.
Our business insurance brokers ensure the cost of business insurance and associated compensation for our brokerage is appropriate for the delivered value.
Unlike other insurance brokers, we exclusively deliver business insurance Canada products and services.
Put simply, our focus on business insurance sets us apart. This is unique within Canada because many insurance brokerages provide a broad range of business and personal lines of insurance. By specializing and, more importantly, focusing exclusively on business insurance in Canada, we deliver deep, thorough, and current knowledge to our clients.
Additionally, our relationships with the biggest insurance companies in Canada are strong and stable. We know how to find the best insurance company in Canada for the products and services your business needs.
What is the Average Cost of Business Insurance in Canada?
The average cost of business insurance in Canada is around 1-2% of a company’s revenue. This means that for every dollar your small business or large corporation earns, you can expect to pay 1-2 cents or more to insure it.
Meanwhile, on average, people spend between 3 and 5% of their disposable income on personal insurance products.
Manage Costs With ALIGNED Premium Financing
Financing spreads the premium payment across the policy’s term. Paying your premium with financing can significantly help your organization’s cash flow.
Premium financing of your commercial insurance does not impact your existing credit.
Here are some additional benefits to financing with ALIGNED:
- Pay monthly, not all at once. You can have monthly payment withdrawals set up directly from your bank account.
- If a positive or negative endorsement occurs during the term of your commercial insurance policy, you can adjust your premium payment schedule.
- We guarantee premium financing for all of our commercial insurance Canada clients.
We provide our premium financing service through our partners First Insurance Funding & CAFO.
We Know How To Help You Reduce Business Insurance Cost
Circumstances change, and the bottom lines always matter. Understandably, people want and need to find ways to decrease the costs of products and services they need and want. Businesses need to make a profit in order to continue providing their products and/or services.
Insurance product pricing is complex and not always clear. We work to deliver clarity, alignment, and value in this area. Our team is proud to be part of a different kind of business insurance brokerage.
Talk to an ALIGNED Advocate and request a quote for commercial insurance Canada premium financing today.
