With many businesses are temporarily shut down during the COVID- 19 pandemic, canceling your business insurance seems like an easy option to cut down costs. However, canceling insurance could lead to other problems and also cost you more in the long run.
Why Is Canceling Business Insurance Not a Good Idea
Here are a few reasons to reconsider your business insurance cancellation:
- You may end up paying more – Most insurers don’t allow policy suspension, which means you must buy new coverage when you restart your business. A lapse in coverage is considered a more significant risk, and you may end up paying more than you save when you apply for insurance cover again.
- Loss of permits – For tightly regulated industries like construction and hospitality, it is mandatory to have business insurance to keep their licenses current and valid. Without insurance, your permit may be canceled, and applying for one after the lockdown could be time-consuming and expensive.
- No protection from theft – With most of us locked up inside our homes, the risk of robbery and burglary at storefronts has increased despite alarms and other security measures. Without insurance, your risk increases further because your premises and goods are no longer covered against such mishaps.
- No protection from loan or lease default – For most small business owners who depend on financing, insurance is often a mandatory requirement. Therefore, canceling your coverage temporarily can put you in default even if your payments are updated, which can lead to foreclosure and leave you without a place of business.
As you can see, canceling business insurance is not a good idea for your business in the long run. Instead, you can consider speaking to your insurance agent to adjust your coverage or premium. You can also switch insurers to get better deals. For comprehensive business insurance coverage in Waterford, Connecticut, contact the experts at The Reardon Agency. We are ready to assist you with all your coverage needs today.
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