This is the first instalment of four blog posts that summarize the 25 quick tips from my eBook, “Insurance Premiums Are Killing My Business." The risk management ebook is a great start for any small to medium-sized business owners that are curious about starting the risk management planning process.

The tips below have been written with small to medium-sized businesses in mind, although the same principles should be employed by very large businesses.


1. Budget for insurance price fluctuations

A key goal of any good risk management plan is to be aware that the insurance market is cyclical and that if prices have been flat or dropping for a few years that they will go up again. Plan for it by budgeting at the top end of the market.

2. Keep your company’s loss ratio low 

A loss ratio is the premium paid divided by the cost of claims incurred. A low loss ratio will make your company attractive to insurers, which will result in them competing for your business. This will lead to your business being offered lower premiums.

3. Work on becoming a coveted account to insurers 

Insurance companies can only underwrite a limited amount of business. Since an insurer can only insure a finite amount of risk, they will choose what they feel to be the most profitable risks to insure. It is important to make sure you are one of the good risks that they want as part of their book of business. ClearRisk can help you with this by supplying a formal risk management plan, which can be printed to show your insurance professional how you are mitigating risk.

4. Choose deductibles that result in the optimal cost of risk 

The general principle is: the higher the deductible, the lower the premium. By analyzing past losses in conjunction with insurance premium quotes for different deductible options, it becomes clear which deductible is best.

5. Make sure your property values and your policy limits are accurate 

Accurate values and limits mean you are adequately covered, and ensure that you aren’t paying an excessive amount.
Insurance and claims represent a large percentage of a business’s expenses but it is an area most business people know very little about. With some simple risk management planning and formalization, many businesses can realize significant savings. 

These tips and more are covered in the full risk management eBook, “Insurance Premiums Are Killing My Business." For more information on ClearRisk's system, 

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