Chris Caves Shares How Businesses Can Limit Inflation’s Effects on Insurance Costs for Phoenix Business Journal
Inflationary pressures have put the squeeze on all kinds of products and services. Insurance is no exception and businesses are seeing premiums rise along with other costs. In an article for the Phoenix Business Journal, Business Insurance Executive Chris Caves explains the reasons why insurers are raising rates and provides key takeaways for businesses to soften the impact of those higher costs.
In addition to normal business expenses, insurance carriers’ decision to raise rates is affected by their ability to maintain a profit and a volatile legal environment. As costs for auto repairs and healthcare increase, they push up the cost for an insurer to pay out on claims, cutting into their revenues. As a result, they must pass on more costs to businesses in the form of higher premiums and tighter coverages to ensure profitability. Additionally, insurers face greater scrutiny and liability in the courtroom, with larger jury awards and settlements that further push up costs for insurers.
Although businesses may not be able to completely avoid higher insurance costs, Chris lays out several actions they can take to limit inflationary effects. These include performing a thorough insurance audit to ensure your business has the proper levels of insurance in place, as well as taking a communicative and proactive approach to renewals. Businesses ought to contact their insurers or brokers early to begin the conversation about renewals, costs and the right levels of coverage.
If your business needs guidance during this current inflationary period to find cost-effective risk management solutions that don’t break the bottom line, the team at Lovitt & Touché can help. Learn more about our business insurance solutions.
Read Chris’ full article here.