No matter the shape or size of your business, insurance costs are a non-negotiable overhead. In order to protect your business from unforeseen events and ensure continuity in difficult times, insurance can be a lifeline.
You’ll need liability insurance to protect yourself from customer claims, property insurance to protect your assets, and a range of other policies to help your company weather stormy seas.
As insurance costs for businesses continue to skyrocket, you might be looking at ways to keep your premiums manageable. One way to do exactly this is by opting for named perils coverage.
This differs from so-called broad-form insurance, in that the coverage it offers is targeted to the specific risks your business faces. Read on to find out everything you need to know about named perils coverage.
What is Named Perils Coverage?
Named perils coverage is exactly what it sounds like. It is a type of comprehensive policy that only covers specific risks that are named in that policy. It is not a broad, general form of coverage.
Instead, it will cover your losses if the exact event that is named in that policy occurs and has a direct impact on your business and your bottom line.
Of course, you can include a broad range of named perils in your policy, but each additional peril comes at an additional cost.
Who Is It For?
At first glance, it might seem like going for a broader, all-risk policy makes the most sense.
However, specific named peril policies can be ideal for select industries and types of businesses. Chief among these are the trucking and cargo truck industries.
Named peril policies are very common features of quality truck cargo insurance, since this industry is at disproportionate risk for very specific events that other industries do not have to worry about.
Common examples of named perils for trucking and cargo industry policies include:
- Storm damage.
- Falling objects.
- Civil unrest.
- Collision with animals.
- Road debris.
For truckers, general policies might not be worth the cost, simply because many of the risks covered are not applicable to truckers.
Is It Right For You?
So, is named perils or open perils the best approach for you? As mentioned, named perils can save you money, since you are only paying for the specific risks that you choose to include in your policy.
The coverage on offer for those specific risks will be much more straightforward and comprehensive, should those named perils affect you. However, if your business is exposed to a broader range of risk, this might not be ideal.
If you are impacted by an event that is not named in your policy, you will not receive coverage. Always speak to an insurance professional to find out the most practical approach for your line of business.
Future-Proof Your Business
Insurance might not be the trendiest business topic, but it remains more essential than ever.
In a world of ever-changing and escalating risks, having named perils coverage that addresses new risks could be a lifesaver for your company and your livelihood.
For more essential tips for future-proofing your business, no matter what life throws at it, we have got you covered.