The Personal Touch is Best When It Comes to Small Business Insurance, Says J.D. Power Study
Daily business insurance is a necessary part of running a business. It protects against accidents or events that can be costly, damaging, or even devastating to your business. Small businesses are at risk for more losses than large businesses because they have more on the line. However, independent insurance agents are available to help you protect your business from different types of loss so you can do what you do best-run your business. Insurance can save you money on more than just your office building. It can provide business insurance property damage, and protection for all kinds of risks that you may encounter.
Do you know what a risk is? It is something that can happen, and it is not certain whether it will happen. If you don’t want to face any risks, you should find business insurance and invest in a business insurance advisor or an independent insurance agent.
A business insurance advisor will help with the business protection plan process of how much coverage you need and the cost of your coverage. An independent insurance agent will go through all of your different options with you based on what type of business or industry your company falls under.
Accidents can happen frequently, and business owners need to have business insurance information to make the best business insurance plans as per the business insurance law.
The best business insurance products give business people peace of mind. When something goes wrong, you have the best business insurance providers who would help you through the whole process.
Business coverage can fill in the gaps to ensure that your business protection is guaranteed. In some instances, you might abide by business laws to purchase certain types of business insurance.
Business covers offer protection to your business from the unseen costs of managing an enterprise. Natural disasters, accidents, and lawsuits could run you out of business if you lack the right insurance.
It’s essential for business owners not to leave themselves vulnerable, and to make sure they have the business insurance they need to cover all the risks present in their business. Above all, not having the right types of insurance can be the same as not having it at all.
Several types of business insurance that business owners might consider are:
General liability insurance, which protects against financial loss due to bodily injury, property damage, medical expenses, libel, slander, defending lawsuits, and settlement bonds or judgments.
Product liability insurance, which protects against financial loss due to a defective product that causes injury or bodily harm.
Professional liability insurance, which protects against financial loss due to malpractice and negligence.
Commercial property insurance, which protects your business against losses such as the destruction of company assets due to various events such as fire, civil disobedience, or vandalism.
Home-based business insurance, which is an addition to homeowner’s insurance to cover a small amount of business equipment and liability for third-party injuries.
A new survey by J.D. Power has found that the personal touch really does matter when it comes to selling small business commercial insurance, and those who write predominantly personal lines of insurance have a greater satisfaction rate for their small business customers.
The J.D. Power 2014 U.S. Small Business Commercial Insurance Study compared personal lines of insurance, such as those from Allstate and State Farm, with commercial insurance from companies such as CNA Insurance and Zurich.
Out of a 1,000 point scale, small business customers (which all had 50 or fewer employees) rated their satisfaction of insurance companies at an average of 783 points. Insurance companies that wrote mostly personal lines of insurance averaged 804 for customer satisfaction; commercial insurers received a score of 766.
All six insurance providers ranking above the industry average this year mostly write personal insurance lines, and they all received higher scores than commercial-based insurance in the survey’s five categories.
The five criteria by which insurance companies were judged included interaction, policy offerings, price, billing and payment, and claims.
The top insurance company this year was Erie Insurance, who also took top honors and a J.D. Power award in 2013, the study’s first year. This year, Nationwide and State Farm tied for second place.
Good insurance coverage of all kinds can be tricky for small businesses to find. Even small business health insurance in the U.S. and Canada can suffer from some major gaps, such as not covering high-cost items like dental implants or braces, and insurance policy costs can determine customer satisfaction, too.
Jeremy Bowler, senior director of the insurance practice at J.D. Power, explained the potential appeal of personal line insurers. “The relationship is typically established early because small-business owners often purchase commercial insurance from the same agent that provides their home and auto insurance. Additionally, the agent is often local, so they have more personal contact with their customers and better understand their business.”
Bowler’s statement is backed by the survey’s results: 41 percent of respondents had their personal insurance with their insurer and later added their business coverage with the same company. Only 12 percent of commercial insurance customers reported this same trend.
Another contributing factor for customer satisfaction included personal interactions with insurance agents. Nearly two-thirds (63 percent) of those with predominantly personal line insurance companies had met their agent in person; only 53 percent of customers of more commercial insurers reported the same.
Predominantly personal and commercial insurers alike both benefit from providing high levels of customer satisfaction. Seventy-nine percent of customers who reported that they were “delighted” with their personal line-focused insurance company (giving a satisfaction score of 900 or higher) said they “definitely will” renew their policies, and 81 percent “definitely will” recommend their insurer to family and friends.
“Delighted” customers of commercial-based insurance companies, however, reported “definitely” renewing 70 percent of the time and 72 percent “definitely will” recommend their provider.