If you haven’t done so already, and particularly in light of the economic situation, one expense area that is worth a good review is your insurance coverage. The Insurance Information Institute, an industry funded organizations, offered this press release yesterday:
The I.I.I. suggests seven ways business owners can save money on their insurance that are applicable to medical practices:
1. Shop around.
Prices vary from company to company, so it pays to shop around. Ask other practices for the names of companies or brokers who they work with and trust. Call several so that you can compare prices and get a feel for the types of services they would provide. Ask the agent or company that provides your personal insurance whether they offer business insurance. It is also important to pick a company that is financially stable. Check the financial health of your potential insurer with rating companies such as A.M. Best.
2. Look at Group Rates.
Purchasing your insurance through a business or professional organization can save you money. The bigger the group, usually the lower the insurance premiums. The savings typically outweigh any member dues. Your local chamber of commerce may also offer plans.
3. Choose a higher deductible.
Deductibles represent the amount of money you pay before your insurance policy kicks in. The higher the deductible, the less you will pay in premiums for the policy.
4. Consider a package policy.
A Business Owners Policy (
5. Set up a risk management/loss reduction program.
Insurers will often lower your rates if you put a program into place that will minimize losses from fire, theft, and employee and customer injuries. These can include workplace safety training programs, disaster preparation and human resource intervention. Consider installing a security or fire system. If your line of business uses vehicles, install anti-theft devices and hire drivers with good driving records. Ask what you can do to reduce risks such as fire or work-related accidents and review the procedures that should be in place in the event your business suffers a major catastrophe.
6. Work closely with your agent or broker.
An insurance professional can provide invaluable advice to help protect your business. It is important to keep your insurer informed about any changes in your business operations. This includes major purchases, expansions or changes in hiring or in the nature of your operations.
7. Have the right amount and type of coverage.
Part of the decision about what insurance to buy depends on the nature of the business. You should consider life insurance on you and the other physicians, as the death of one of the income drivers would crimp the organization. Having the right amount and type of coverage along with a carefully developed business plan that includes disaster preparedness can save you money in the long run. Be sure to keep your agent fully apprised of any changes within your business that might necessitate changes to your insurance coverage. Such changes may include: adding employees, expanding your business, increasing your inventory or materials, purchasing major equipment and adding suppliers.
For more information on how to properly insure your business, go to the I.I.I. Web site. The I.I.I. also has a publication, Insuring Your Business: A Small Business Owners’ Guide to Insurance.