When you’re looking to add a new piece of equipment at your facility, you usually don’t buy the first one you see. You compare features, price and service and then decide which fits your business model best.
Purchasing insurance should be handled the same way. All salons are not created equal and prices and coverage can vary from carrier to carrier, so it’s always prudent to compare. The most logical time to shop for insurance is when your current policy is approaching expiration. However, as we always say, you should plan ahead. It’s not a good idea to call other carriers and expect that they will be able to provide a quote, get you the forms and bind coverage on the day you call. They also will not usually be able to back-date coverage. So, to prepare you for your shopping trip, here are a few suggestions.
- Start shopping a full month before you will need the coverage. This also applies if you are considering purchasing a new salon or moving to a new location.
- Be prepared to provide information you may not consider relevant. Even though you don’t own the building, the insurance company will need to know what the building is constructed of, how old it is, who the other tenants are and what type of maintenance is done.
- Have a copy of your lease on hand to make sure that any coverage you are quoted meets the insurance required by the agreement. Some info the carrier will need includes what liability limit is required, whether the landlord needs to be named as an additional insured, if you as a tenant are responsible for glass or HVAC units, and whether a Waiver of Subrogation is needed.
- If possible, obtain loss runs from your current carrier, which they are required to provide you when requested, and which give the new company a clear view of your history with claims.
- Determine the full replacement cost of everything in your salon that would need replacing in the event of a total loss. This means the cost of each item if purchased new, not what you paid for it or its current value. Always remember to include build-outs, stock, equipment and supplies including computers, washers, dryers, towels and anything else you would be responsible for according to your lease.
- Have your income numbers for the past year available.
It is very important that you’re honest when supplying your information; none of it is shared with anyone. You will be required to sign an application stating that the information is accurate and if it is not, there could be penalties at the time of loss.
While you’re encouraged to start shopping early, remember that most quotes are only valid for 30 days. If you obtain a quote you like, don’t assume the rate will available at a later date. If you need insurance, bite the bullet and purchase it – delaying could make it more expensive.
I know shopping for insurance is not nearly as much fun as, say, shopping for new shoes, but it is very important. The peace of mind that coverage provides is worth spending a little time to get.
