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Why the Co Insurance Clause Could Cost You Thousands


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The Co-Insurance Clause is a tricky thing that many small business owners overlook simply because they don't understand the jargon. This should not be surprising - business owners do not have time to waste pouring over insurance contracts and premium details. Business owners are there to run their small business.

What is Co-Insurance?
Generally speaking, this sneaky little clause applies to commercial property or business property and requires that you - the business investor or owner - insure the company property up to a certain point or risk paying a penalty on a claim. Paying such a penalty can be a very disappointing experience because it will usually occur at a time when you really cannot afford it. Accidents and losses are never welcomed experiences - especially in a business environment where time is money and assets are essential to future production.

Consider an example:
If your Co-Insurance clause states 80% then you are required to have proper business insurance coverage up to that percentage limit. If you do not, then the insurance company will not necessarily cover your loss.

Business Property Value: $300,000
Co-Insurance Statement: 80%
Actual Insurance Coverage: $200,000

Since the clause in this example requires eighty percent, then you would need at least $240,000 of coverage or 80% of your actually business value. Since you do not have the full coverage required, you stand to pay a penalty in an insurance loss or accident. Because this will surprise most small business ownership teams, it's important to look into your co-insurance contract immediately.

Most small business professionals (and even the self employed) do not know about the power of the Co-Insurance clause. Don't be left out in the cold when an unexpected event occurs in your business that could negatively affect your livelihood. Having proper insurance coverage is an essential part of your success in the business world and you never know when something is going to happen.

Find out everything else you need to know about small business co-insurance today! This is just one of the many secrets in the small business insurance world. Read much more at before it's too late.


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