Most insurance companies offer group insurance rates for insuring large numbers of people because economies of scale come into play. Large corporations can easily provide an insurance company with a base of thousands of members, but a small company might be hard put to provide a dozen. Thus, large companies tend to get better business insurance rates than small companies do.
This may seem unfair. As a small business owner, you have less money to pay for insurance than a large corporation does and yet you’re expected to pay more. Is there any way around this problem?
Yes. Any kind of large group is eligible for discounted rates on certain kinds of insurance. Although your company may not be large enough to qualify, you can join a professional association and become part of a larger group—and then you’ll qualify.
Where do you find such professional organizations? Just go to a search engine like Google or Bing and type “trade association” followed by the name of your industry. You shouldn’t have much problem turning up the name of the most important organization of people who do the same thing that you do, whether it’s styling hair or writing screenplays. Go to the Web site for this organization and look to see if they provide insurance benefits. Chances are they do, and you can take advantage of it for the cost of membership fees and dues.
Whether they provide the kind of coverage you want is another story. Most will offer health insurance and many will have life and disability insurance. Liability insurance and property insurance may be a bit harder to find. If you don’t see the package that you’re looking for, write somebody at the association and ask their advice. When in doubt, always turn to someone in your own industry to find out what the best options are. It won’t be long before you find someone who has already been through the process that you’re going through and has found the best way of acquiring low-cost business insurance.
In fact, a major benefit of belonging to a professional association is that you’ll have other people to talk to, people with similar experiences and in depth knowledge of solutions. Finding a Web forum where people in your industry chat about their experiences can save you many years of trial and error.