By Jill Nagy
When it comes to insurance coverage for a small business, “there is no one-size-fits-all formula. It is important to have a good interview with each business owner,” in order to design the right package for the business, according to Jack Beniek, vice president of Cool Insuring Agency in Queensbury and Latham.
Colleagues at other area agencies agree.
“The basic thing in today’s world is that, just as each business is different, each business’s insurance needs are also different,” said David Dewez, president of Canoe Associates, with offices in Glens Falls and Clifton Park. “It’s totally different from homeowners coverage; we have to customize.”
John O’Brien, president of the O’Brien Insurance Agency in Glens Falls, also insists on customizing.
However, when he lectures a few times a year at SUNY Adirondack College, he comes armed with an outline of “topics of concern,” including liability, business auto, property, Workers Compensation, disability, life and retirement insurances.
The Canoe Associates website, canoeassociates.com, has a similar but more detailed checklist listing close to 150 possible types of coverage.
Some coverage is mandated by New York State law, such as Workers Compensation, disability, and motor vehicle liability coverage.
O’Brien suggested starting with a package of general liability, to compensate people injured on the business property or by its products, and property insurance to compensate the business owner for damage to the business premises and building contents. The actual details? It depends.
Commercial auto coverage picks up where a personal automobile insurance policy leaves off. If the family car is used in the business, especially if it is used to transport property, that coverage may be necessary. “Once you take your automobile and start using it in a business context, such as hauling materials or transporting other people, you need a commercial lines policy,” Dewez said.
Another group of coverages is loosely defined as “business interruption” coverage. O’Brien includes in that category long-term disability coverage for the business owner and key employees.
“I tend to separate that out from disability coverage for employees,” he said. Life insurance is another “very important issue to discuss, he added.
O’Brien recommended a team approach involving the company’s attorney and accountant as well as the insurance agent.
“When you are about to start a business, you should come to me,” he said. “We talk about the reason people should be looking at these coverages but you should also discuss it with the other professionals” advising the business.
“A large part of what we do is advise on risk management practices,” Bieniek, of the Cool Agency said. He also questions potential clients on many details of their businesses: Do they directly employ people? Lease employees? Do they own or rent the business premises? What are the expectations of any lenders? How do they manage their cash? All of these factors affect the amount and types of insurance the business needs. It is the rare business owners who will need–or can afford–the 150 or so types of coverage on the Canoe website. Depending upon the type of business, Bieniek suggested budgeting between 0.5 percent to 5 percent or more of projected gross revenues.
Dewez suggested that, for a sole proprietor with no employees, $600 to $800 a year may be reasonable. A larger business with its own building and several employees may be looking at an insurance bill 20 times that size or more.
Cool Insuring Agency sells policies written by several different insurance companies. The agency has been in business since 1857 and was acquired in the 1880’s by Charles Cool, a businessman who also dabbled in limestone, real estate, and the telegraph business. When Glens Falls was incorporated as a city at the turn of the 20th century, Cool became its first mayor. The company’s phone number is (800)648-4824.
Cool is now a large regional company selling insurance “up and down the eastern seaboard” with agents licensed in 32 states. They have 115 employees.
Members of the O’Brien Insurance Agency are also independent agents. The agency has five employees, two in the office and the rest, working from home. They are particularly proud of winning the 2013 J. Walter Juckett Community Service Award of the Adirondack Regional Chamber of Commerce. They can be reached at 793-5173.
Canoe Associates sells primarily Nationwide Insurance policies but also represents other companies. Dewez has been a Nationwide agent since 1980 and became president of Canoe Associates in 2004. The agency itself was formed in 1974. They have eight employees. The phone number for their South Glens Falls office is 792-9915. The phone number for the Clifton Park office is 383-3361.