Changing insurance providers as your policy is coming up for renewal and before it expires is not unusual, and it may save you money by getting the coverage you need at a better rate.

You can switch insurance providers anytime, but if you cancel an existing policy early, you might not be entitled to a pro rata refund on the premium paid. 

A business insurance policy may also be subject to a minimum retained premium, usually 15% to 25% of the annual premium you have paid. For example, if your minimum retained premium is 25%, and you cancel a policy within the first three months of purchasing it, you will still owe three months’ worth of that premium. Therefore, if you’re making monthly payments and have only paid for one month, you’ll still owe that provider two more months’ worth of payments.

If, on the other hand, an insurance provider cancels your policy, you will receive a proportionate refund of the total premium.

How and when to switch business insurance companies.

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Zensurance - Small Business Insurance Guide

When Should You Consider Switching Insurance Providers?

Small business owners may consider switching their insurance companies for various reasons, and the decision should be based on a careful evaluation of your needs, coverage, and overall satisfaction with your existing provider. 

You can change insurers whenever you want, but you may incur a penalty from your existing insurer if you cancel a policy midterm (short-rate cancellation). It’s best to inquire what the short-rate cancellation might be. If it’s not economically beneficial to switch midway through your existing policy’s term, waiting until that policy comes due for renewal and then making a switch may be the best option.

Nevertheless, here are some common reasons why a small business owner might consider switching to a different insurer:

To Save Money

One of the most common reasons is the opportunity to save on an annual insurance premium. Insurance premiums change annually, and not all policies are priced the same by each insurance provider. If a business owner finds another insurance provider offering comparable coverage at a lower cost, making a change may be financially beneficial.

Changes in Your Business’s Operations

If your business has changed or is making changes, such as expansion, diversification, or downsizing, your existing coverage may no longer be sufficient. Therefore, seeking a new policy that better aligns with your evolving needs is beneficial. A Zensurance broker can help you compare quotes quickly from over 50 insurance providers to ensure you get the coverage you require at a low cost.

Enhanced Coverage

Your business may require enhanced coverage or specific policy features your current insurance provider does not offer. In that case, looking for an insurance provider offering better terms, additional coverage options, or more favourable policy terms is worthwhile.

Poor Customer Service

Unsatisfactory customer service experiences can prompt a business owner to explore alternatives. If the current insurance company is unresponsive, challenging to work with, or provides inadequate support, that’s enough to look for a better, more responsive service.

Poor Claims Processing

Delays or challenges after filing an insurance claim and resolving the settlement process can be frustrating. When you need your insurance provider’s help, you want an efficient claims resolution process.

Changes in Your Industry

Changes in the regulatory environment or industry standards may affect your company’s insurance needs. Sometimes, that requires switching insurance companies to ensure compliance with new regulations or to access coverage that better addresses emerging risks in your industry.

A Merger or Acquisition

If your business undergoes a merger or acquisition, there may be a need to reassess and consolidate insurance coverage. The new entity may work with a different insurer or negotiate new terms.

Availability of Discounts or Bundling Options

Insurance companies may offer discounts for bundling multiple policies with them. Finding an insurer that provides cost-effective bundled packages or industry-specific discounts is a compelling reason to switch.

Reevaluating Your Needs During the Renewal Period

Many businesses reassess their insurance needs during the annual renewal period. It’s a wise thing to do. When a policy is due for renewal, it is an opportune time to compare quotes, review coverage, and consider switching if a better option is available.

3 Easy Steps for Cancelling Your Current Policy and Switching Insurers

It is easy to cancel your existing business insurance policy before its expiry or renewal date and switch to a different insurance provider. A Zensurance broker can help you do so quickly and easily. Here are the steps that are involved:

1. Get a free insurance quote from Zensurance and find the policy and price you want.

2. Contact your existing insurance provider and find out how much you might owe in premium by cancelling. Inform them you wish to cancel your policy and switch to another provider. You may have to sign a cancellation form to verify the date of cancellation. Your Zensurance broker can help handle the cancellation process with your existing provider.

3. Purchase your new policy from Zensurance. We will then send you your policy documents and a certificate of insurance.

That’s it!

Want a Better Business Insurance Rate? Let’s Explore Your Options

Getting a free business insurance quote through Zensurance is quick and easy. 

Fill out our online application form and tell us about your business or profession for a free quote. A Zensurance broker will shop our partner network to find the low-cost protection you need and contact you to discuss your options for customizing it.

Protecting your business, reputation, and assets with a comprehensive business insurance policy is vital for ensuring your company’s financial health and continuity. Let us help you get the coverage and peace of mind you need so you can concentrate on delighting your customers.

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About the Author: Jon Hogg

Jon Hogg is the Senior Team Lead, Renewals, at Zensurance.