Having adequate business insurance can make all the difference in whether or not your company is successful. For this reason, it’s crucial not to skimp on coverage to lower your premiums. Instead, make sure you’re getting the best deal available by becoming familiar with the various factors insurers take into account when calculating costs. This will help you identify ways to reduce your rates. Here are some of the elements that influence policy prices.

What Determines How Much You Pay for Business Insurance?

1. Location

Where you operate your business from is a key consideration for several reasons. If you’re located in an area that’s prone to natural disasters, you’ll be charged more to cover the increased chance of damages. Also, being in a neighborhood that has more criminal activity and foot traffic means there’s a greater probability of vandalism, theft, and injury lawsuits, which will translate into higher insurance premiums.

2. Risk Level of Industry

Although every business is vulnerable to potential risks, there are certain industries that face a higher level of risk than others. For instance, because of the nature of their work, electricians and construction companies are more likely to file insurance claims than those in retail or accounting. Thus, organizations in high-risk industries can expect to pay more for coverage.

3. Revenue

The more money your business generates, the more you have to lose if a lawsuit is brought against you. To help offset costs associated with legal fees, settlements, and court judgments, providers will usually raise policy rates. Additionally, you’ll need more insurance, which will boost your premium.

4. Claims History

Insurers will also look to see if you’ve received any policy payouts in the past. They typically view an extensive history of filing claims as a good indication of future claims. In turn, your premium will be priced higher.

If you need business insurance or a policy renewal, turn to Mountcastle Insurance for helping to secure quality coverage at the lowest rate possible. They will work with you to customize a plan that provides suitable protection for your operations without being a burden to your bottom line. Based in Winston-Salem, NC, they’ve been the Piedmont Triad’s most trusted source for reliable products and superior customer service for nearly 130 years. Call (336) 777-8500 to request a quote, or visit their website to view a list of insurance solutions they can offer your company.