Selecting an office:Location Matters For Business Insurance

By Meha Ahmad, InsuranceAgents.com Staff Writer

Business liability insurance is perhaps one of the most important things to consider when venturing out on your own to start a business. And it doesn’t matter what your business is—every small business owner will need a general business liability insurance policy.

The purpose of business liability insurance is to cover injuries to the employees (if any) and customers, damage to property, legal fees, and other types of losses. To find out how much business liability insurance may cost you, compare business liability insurance quotes in your area.

Business Liability Insurance: Starting the Office Search

When you begin the search for the right place to situate your lifelong business dream, you probably don’t have business liability insurance on the mind. Instead, you may be tempted to choose an office based on its low price alone, or because it has that “look” you’re going for. Or maybe you’re interested in a place in the city with a high amount of traffic so as to maximize your amount of customers and revenue.
However, you should be thinking in terms of what factors of your business’s location will increase or decrease your business liability insurance costs.

Location, Location, Location

Where your business is—the area, the type of building, etc.—determine how much you will pay for business liability insurance and how much coverage your business will need. When scouting out a location for your business, here are a few things to keep in mind that will affect your business liability insurance:

• What kind of building is it? If it’s a relatively new building, than it is more likely that it was built according to current building codes and standards, meaning it’s less of a liability risk. Older buildings—that may be worn down, not up to code—will cost you more in business liability insurance.
• What kind of crime rate does the area have? If the area sees occasional to frequent incidents of violence, vandalism, gangs, theft, then you’ve got a problem. High-crime areas make business liability insurance skyrocket.
• Suburbs or city? When it comes to business liability insurance, suburban office locations are almost always cheaper than locations in the city. Typically, crime rates are much higher in the city, which cause business liability insurance to cost more, as previously mentioned. In fact, many insurers won’t consider clients whose offices are in the city without some form of alarm system. Also, higher traffic in the city poses its own risks that affect business liability insurance.
• Is there a lot of traffic? If your office is located near high-traffic areas, it increases the chance that a car accident can damage your property and/or customers. This is a major business liability insurance risk.
• What are the nearby businesses? Nearby businesses can mean major risks for your office. If your office neighbors a restaurant, your business liability insurance cost will go up, up, up. Restaurants are high fire risks. If a fire breaks out next door and damages your property, and their insurance doesn’t cover your damages, you’ll have to turn to your own business liability insurance policy for financial help.

Remember to keep these questions in mind when scouting a location for your office/business. Consult a business insurance agent for other risks that may affect your business liability insurance. Also, find out what tips can lower your business liability insurance quotes.

Published: Thursday 15th October 2009