Pricing for Business Insurance
As your company looks into purchasing or altering its small business insurance coverage, how much you will pay for the plan will most likely impact the decision making process.
Dating back to 2006, rates had been increasing very little, actually declining for a number of businesses, in some cases on the average of 9 to 10 percent. The trend came to a halt in 2010 when the average rate fell by just 1.5 percent.
Now, however, SNL analysts say rates are headed in the opposite direction, as the insurance industry continues to experience poor results in tandem with anemic interest income. Those factors are leading insurers’ to increase rates so they can maintain acceptable numbers.
Natural disasters (such as fires, earthquakes, hurricanes, etc.) costing insurers close to $100 billion have started to increase some commercial insurance rates following a decline over five years.
Recently due to earthquakes in Japan, New Zealand and Chile and tornadoes in the United States, insurers are charging more for property coverage. Meantime, businesses are looking to increase finances after the recession reduced value from investment portfolios and limited demand from business clients.
For companies looking at their small business insurance coverage, they are advised to review their business insurance programs and see where changes can be instituted to mitigate the added costs that are coming down the pipe.