Commercial Insurance – How to Cut Your Insurance Premiums

Keep your losses down!

MAKE YOUR PREMISES SAFE FOR YOUR CLIENTS: The most common Commercial Liability claim is the basic “Slip & Fall”. These are more common in restaurants than any other business. However, this can also happen in your business if clients visit your business.

MAKE YOUR WORKPLACE SAFE: The cost of worker’s compensation is rising rapidly. You must be aware of what your employees are exposed to at work. Your premiums will go up if you have more claims, whether it’s Liability, Property or Worker’s Compensation.

MAKE SURE YOUR PROPERTY IS UP TO DATE: Property policy premiums typically depend on the type and condition of the property. Keep everything in compliance with code and remember that an Insurance Inspector will likely visit you.


Take a look at your policies, and be sure to pay attention to the “Declaration” pages. Ask your Insurance Agent to flag the “dec” pages. These pages will explain how premiums are calculated. In General Liability policies it may be based on a number of factors, such as Cost (of goods sold) or Costs of Subcontractors, Number of Employees and Payroll. Worker’s compensation, however, is based only on “Payroll”. See my website to see an article that explains the difference between an “Employee” and an “Independent Contractor”. You should know exactly what you’re paying for and when you need to adjust the numbers.


Your Bookkeeper should have a basic understanding of how your policies were rated. Sub-contractors should also be able to provide Certificates of Insurance. Workers’ Compensation policies are audited every year, while General Liability policies are being audited more often than ever. If you do not have an accountant, it is worth getting help. QuickBooks is a wonderful software program, both for small and large-sized businesses.

Your eyes and ears should be the SUPERVISORS. Your supervisors should ensure that your work areas are ready for inspection by your Insurance Company and/or OSHA.


Independent Insurance Agents represent many Insurance Companies and sell most Commercial Insurance. Your current agent may simply offer you the renewal rate they have been offered by your carrier. It’s worth shopping around with Independent Agents before you agree to any binding coverage. If you shop for quotes from several agents, compare them “apples-to-apples” in terms of rating factors like Gross Receipts and # of Employees.


Many Commercial Insurance policies can either be financed or on a monthly payment plan. Your policies may be cancelled if you fail to make your payments on time. Your premiums will be determined by the company underwriters. All Commercial Insurance Applications will ask you if there was a lapse in coverage. You must also sign the application to confirm that the information is correct. It is a sign that the applicant is responsible and a business owner.

The bottom line is that the longer your business exists, the greater chance you have to get preferred rates. However, it is important to keep track of all things. Avoid any claim situations by doing everything possible. A safe workplace makes employees and clients happy. Make sure you pay your bills on-time and that you are available to answer any questions or concerns. A tight ship is a great way to make your money!