Entrepreneurial Tightrope: Better consolidate your insurance

— -- Hi, Gladys, I am becoming cash poor from all the different business insurance that I pay. I understand that every business needs insurance, but it seems every week a new guy shows up to sell me "must have" policies. What bothers me most is trying to keep up with the various agents and the payment due dates. I am going crazy keeping up with all of this. Why are there so many different policies and agents ? — A.S.

One of the reasons to have insurance is to allow you to run your business without worrying about unexpected things that can level a company.

Some policies are mandatory; others are convenient. In order to get the right insurance for your company, it sounds like you need to consult with an insurance broker.

To help in answering your question I called my insurance broker for guidance.

We both agreed that a business should consider bringing all of its insurance needs under one roof if possible. This allows the entrepreneur to be more effectively and efficiently served.

He reminded me there are a wide variety of policies available, from workman's compensation to coverage for employee dishonesty. Of course, not every company needs every policy. A good broker will get a good understanding of the business and then make recommendations based on the needs and size of the company.

A payment schedule is set up to fit the business and the broker notifies you when payments are due. A broker should do an annual review of your insurance needs to make certain that you are covered in all the necessary areas as your business changes.

Insurance is important, and having someone to take care of all of your insurance needs, personal as well as professional, can make things easier to deal with.

I learned this lesson many years ago when I went out to get into my car and found it had been stolen. I immediately had visions of all of my errands not getting done. I called my insurance broker right away.

His calm demeanor settled my hysteria. He told me to call the police and said he would have a replacement delivered within a few hours. I did, and he did.

Several years after later one of my clients fell down the steps at my office. Needless to say she called her lawyer and I called my insurance guy. The situation was settled with no hassle to me.

When buying insurance, sometimes it's almost impossible to anticipate the types of coverage you need. I remember several years ago unusually heavy rains in Pittsburgh gave a number of entrepreneurs a painful lesson.

Of course, everyone knows intuitively that structures located near rivers are subject to flooding. But many area small businesses some distance away from the river never considered that they might need flood insurance. So, very few were prepared the day the rains came and the sewers backed up in several communities, causing flooding and destruction beyond belief.

I worked to help several businesses recover after the disaster. Those able to regroup quickly had the needed insurance.

Talk with some of your friends who own businesses to see who uses which broker, and how happy they are or aren't with their arrangment. Or, get referrals from folks in the same business as you. However you choose to search for a good broker make sure that you talk with and interview several before making a selection.

Having the necessary insurance coverage is essential to doing business; you simply can't afford to be without it. But be sure and look around for that one, single agency that can make your life a lot easier.

Gladys Edmunds' Entrepreneurial Tightrope column appears Wednesdays. As a single, teen-age mom, Gladys made money doing laundry, cooking dinners for taxi drivers and selling fire extinguishers and Bibles door-to-door. Today, Edmunds, founder of Edmunds Travel Consultants in Pittsburgh, is a private coach/consultant in business development and author of There's No Business Like Your Own Business, published by Viking. See an index of Edmunds' columns. Her website is www.gladysedmunds.com. You can e-mail her at gladys@gladysedmunds.com.