Can my commercial insurance premiums change?
It is possible, yes. Most general liability contracts are good for one year. And usually, your premium is guaranteed not to change during that time, even if you have a claim.
However, some policies include an adjusted premium, to account for increasing sales or busy seasons. For example, if your Colorado small business is a ski resort that only operates for six months during the year, insurers understand that your risk for a lawsuit is increased during your busy time. You may pay more for insurance during busy season, and less when business is slow.
Why is business liability insurance so expensive in Colorado?
Insurance companies know that Colorado is a litigious state. Compared to other states, some resources rank Colorado as the second-most likely state in which your business might be sued by a customer. And remember, non-economic damages (like pain and suffering) are allowed in lawsuits, to the tune of $1.2 million dollars in some cases.
I have liability coverage in my business owners‘ policy. Isn’t that enough?
That’s up to you. Read your policy, consider the risks, and think about the likelihood that your company may be sued at some point. The liability coverage on your commercial property policy may be capped at $100,000 or even $500,000. You may be able to increase that coverage on your commercial policy, but you may wish to add a stand-alone liability policy, too.