Categories
Insurance

What Business Insurance Does My U.S. Based Accounting Practice Need?

Well, you’ve done it! You’ve started your own accounting or bookkeeping business. Congratulations! Maybe you’ve been at this for some time now. Perhaps you are a member of the “The Great Resignation.” Either way, gone are the days of dreaming about working for someone else. You are the boss!

Whether you are just starting out with a new business or have been doing this for years, small business ownership can be overwhelming. This can be especially true when searching to find insurance policies that suit your business. The good news is that business insurance doesn’t need to be complicated.

Today, we will begin to decode the U.S. business insurance world for you. This will allowing you to assess the value of your current coverage. You can start pondering whether you’ve found the right business insurance fit.

Starting Your Business

When you first started your business, you probably heard the usual list of advice. Form a business entity. File for an EIN. Set up a website. Those are all great pieces of advice. All of those items are neccessary for your business. But, here’s a question. Did anyone ever mention business insurance to you? 

Probably not. 

There is a lack of willingness to discuss insurance. We know, it isn’t the most riveting topic to some! Also, business insurance tends to be confusing. This is true even for those who have been effectively running their own business for years!

Let’s just take a moment and start plotting out what business insurance means to accounting and bookkeeping practices. That way you can consider what your business’ needs are, based on your business’ risks. 

What Insurance Does My Business Need?

Just like your clients, every practice is unique in their own way. The good news is that there are some general commonalities that most accounting and bookkeeping businesses share.

The following is a step-by-step guide to the foundational business insurance coverages for accounting and bookkeeping business.

General Liability Policy

General liability is perhaps the business insurance coverage that people are most familiar with. It is a foundational policy, the minimum any practice should consider. Essentially, general liability insurance is just what it sounds like. It provides general protection against common business risks when engaging with the public and clients. This type of policy mainly focuses on the risks and expenses related to the bodily injuries and property damage of others.

While more and more businesses transition to the all-digital remote operating realm, accounting is one of those industries where in-person interactions are still prevalent. Many accounting firms are still conducting business in physical locations, even if it tends to be more hybrid in nature these days. And if your business is one of them, general liability is a coverage you definitely should consider.

Perhaps you’re sitting in your company’s office at this very moment, looking around and thinking that an accident would be impossible. What’s the likelihood that any of your clients would be injured, or their property damaged, during their annual in-person tax review? But take a closer look. Any loose rugs in the office? Dim lighting? Any snow being tracked inside? What’s the average age of your clients? Accidents can—and will—happen, millions of times a year, and you certainly do not want to be caught without insurance when they do. 

Business Owner’s Policy

The next step up from general liability, in terms of breadth of risk protection, is a business owner’s policy, commonly referred to as a “BOP”. A BOP is a combination coverage. It provides general liability policy offerings, with additional property protections. 

Simply put. . .

General Liability + Property Liability = BOP

The additional property protections in a BOP mainly focuses on protecting your business’ property, moving beyond a general liability policy, which typically focuses on the property of others. For accounting practices, a BOP becomes important when one considers the office furniture, business equipment, and commercial property holdings of the business. If your practice has invested in these types of items, then a BOP, rather than a general liability policy, may be more appropriate for your business.

Another unique feature of a BOP is business income interruption offerings. In the chance that your practice has to temporarily close its doors due to a covered cause outlined in your policy, such as a fire, business income protections will help cover your business’ operating expenses like payroll and monthly bills, as well as, assist in replacing lost income.

So naturally, the question now becomes, does my business need a general liability policy or a BOP? Because truly, you should start with one of them. Remember, general liability is the floor. . the foundational policy. . .the minimum level of coverage for your business. 

But, a general liability policy may not be enough coverage for your business’ day-to-day operations. Your practice may be ready to upgrade to a BOP if it employs multiple people, has invested in computers and other business equipment for those employees, or owns the building it operates out of. If your risks are broader, then so too should be your policy selection.

Professional Liability Policy

After you’ve selected a policy to cover your everyday business exposures, as outlined above, it’s time to address those risks inherent to tax preparation, bookkeeping, and accounting professions themselves. Professional liability insurance, also referred to as errors and omissions insurance or E&O insurance, protects you and your practice against claims of inaccuracy, omissions, or misrepresentation. When the expertise and skill of you and your employees is your business, an E&O policy should be highly considered. 

A professional liability policy may provide protections not only in drastic scenarios, such as lawsuits arising out of mathematical errors, but also, from the risks of client dissatisfaction, namely, issues surrounding missed deadlines or inaccurate projections. To believe that you or anyone in your practice is impervious to mistakes is wishful thinking. Even if you, or someone on your team, makes an unintentional mistake, it doesn’t change the fact that your clients may have the right to sue you for damages they incurred.

But wait, isn’t this all addressed under general liability insurance? Why is liability getting mentioned again? Is there a difference between general liability insurance and professional liability insurance? 

So glad you were paying attention! Here’s the key. General liability insurance addresses physical risks, such as bodily injuries to others. A general liability insurance policy is not typically designed to protect against the risks associated with performing your professional services.

There are two different types of liability at play here, and as such, to fully address the risks of your practice, a layered approach is advisable. General liability or a BOP for everyday practice risks, in addition, professional liability coverage to protect against the specialized exposures of your chosen profession.

That’s a Lot of Insurance: How Much Does Business Insurance Cost?

As mentioned, every industry and every unique business in that industry has different needs, which in hand, creates individualized price tags for insurance packages. Yet, let’s take a moment to address a few common factors in the pricing of insurance coverages and provide typical costs of the policy types described above.

Factors In Pricing

First, the size of your company plays a role in determining what these insurance premiums will cost. It’s seemingly straightforward: the more people you have working for you, the more business generated, and therefore, the more risk exposures, whether professional or physical, are created.

Also, the physical location of your practice and the types of services performed are also important factors. As you might have guessed, firms located in coastal cities like San Diego or Boston likely cost more to insure than firms residing further inland. As for services, if your practice provides tax advice for companies on the S&P 500, with their numerous regulatory requirements, rather than servicing small business owners or private citizens, the risk exposures and the likelihood of claims, increases.

In addition, your business’s history of claims may have an effect on your premium costs.  Let’s use car insurance as an example. If a person has a history of auto accidents, that person should expect to pay higher premiums because auto insurance providers classify them as high-risk. If your business has a history of lawsuits, you can expect a similar scenario for the pricing on your business insurance.

At the same time, if you want to have the most comprehensive insurance impossible with higher limits, you will pay more. Again, from an insurance provider’s standpoint, it’s seemingly straightforward: the greater the potential for them having to pay out large sums of monies, the higher your cost will be. 

Typical Business Insurance Pricing

Now, if you really want to get into the nitty-gritty on the costs of business insurance, check out our Gild Insurance FAQ page. But here, let’s at least outline a bit of information.

First up, general liability. So, how much is general liability insurance? According to our partner insurance providers, as well as, based on the coverage selections of Gild Insurance Community, general liability insurance typically costs between $300 and $500 annually. Costs will increase with riskier professions, such as construction.

If you select a BOP rather than a general liability policy, the pricing will likely increase. This is typically attributable to the added property protections. So, how much is business owner’s insurance? Generally for selections made by the Gild Insurance Community, prices are usually between $500 to $1,000 annually.

Now, for our last policy type, professional liability insurance. How much is professional liability insurance? Based on information from our insurance providers and choices made by the Gild Insurance Community, professional liability policies typically start around $1,000 annually.

Yay, Insurance! Now, What Do I Do?

If you’re shopping for an insurance policy, finding the right one is almost as tricky as buying a new home. There are so many companies to choose from that the deciding factor often comes down to sheer exhaustion rather than settling on a company that is the best fit. The good news is that this doesn’t need to be your experience. 

Insurance may not be the most exciting topic (and that’s coming from people who work in the industry), but at the very least, finding the right insurance can be a more pleasant experience. Head to our site and meet Gildber (that’s our adorable husky digital assistant). He’ll help get you started with personalized information that you can then use to take your business to the next level. If you want a visual of the world of business insurance to add to your decoding skills beyond this blog post, including what other coverages may be important for your accounting or bookkeeping practice, check out the Gild Insurance Business Insurance Map on the Gild Insurance site.

We’ll see you there!

Sources: 

  1. Boop, Gregory. “Do I Have to Buy Workers Compensation Insurance?” The Balance Small Business. The Balance Small Business, December 19, 2019. https://www.thebalancesmb.com/how-does-workers-compensation-operate-in-my-state-462786#:~:text=Texas%20and%20Oklahoma,are%20obligated%20to%20buy%20insurance.).
  2. “Safety Topics”, National Safety Council, Accessed August 5, 2022. https://www.nsc.org/work-safety/safety-topics/slips-trips-falls
  3. “Business Owners Playbook”, The Hartford, Accessed, August 5, 2022. https://www.thehartford.com/sites/playbook/smallbusiness/files/DemystifyingInsurance.pdf
  4. Frankenfield, Jake. “Errors and Omissions Insurance (E&O).” Investopedia. Investopedia, June 29, 2022. https://www.investopedia.com/terms/e/errors-omissions-insurance.asp.
  5. “Professional Liability Insurance | the Hartford.” Accessed August 5, 2022. https://www.thehartford.com/professional-liability-insurance.
  6. “General Liability For Accountants.” Accessed August 5, 2022. https://www.hiscox.com/small-business-insurance/professional-business-insurance/accountant-insurance
  7. “What Is a Businessowners Policy (BOP).” Nationwide. Accessed August 5, 2022. https://www.nationwide.com/lc/resources/small-business/articles/what-is-a-business-owners-policy. 
Categories
Trends

National Dog Day Is August 26th!

Here’s How Your Pooch Can Improve Your Work Performance!

While many of us would agree that working from home has had its ups and downs, one undeniably positive improvement has been the ability to hang out with our pets all day long. Sure, they can be needy sometimes (we’re looking at you, french bulldogs), but they have been unwavering companions in these past years when so many of us felt more isolated than ever before. 

National Dog Day is celebrated annually and was founded in 2004 by Colleen Paige, a pet and family lifestyle expert, animal rescuer, dog trainer, and author. Why August 26th, you may ask? That’s the day Colleen’s family adopted their first dog from a local animal shelter back when Colleen was only ten years old. 

The purpose of National Dog Day is to bring greater awareness to the growing number of dogs that need to be rescued yearly and all the tremendous work that goes into that effort. At the same time, the holiday’s creators want the public to be mindful of all the dogs that work each day selfishly to protect, save lives, and bring comfort to their human counterparts.

To celebrate National Dog Day, we thought we’d take a moment to recognize the most popular pet of them all: dogs. (No offense intended to any other species out there, but we’re just stating facts here.) We thought we’d speak a little about all the great benefits that dogs bring to their human companions, how they may improve your workplace or workspace, and tell you a little bit about our main man, Gildber The Husky.  

The Health Benefits of Owning a Dog

Physical Benefits 

Dogs are cute, loyal, good with children, and just plain fun. Aside from that, dog owners benefit from numerous physical and mental health benefits. For one, as any dog owner can tell you, dogs are great exercise. Even if your dog isn’t particularly active, between feeding times, bathroom walks, and chewing toys that get thrown across the living room, dogs have a way of ensuring that you don’t spend too much time lounging on the sofa.

But besides that, did you know that a study conducted by Circulation: Cardiovascular Quality and Outcomes, a journal of the American Heart Association (AHA), found that dog ownership was associated with longer life expectancy among those with previous heart conditions? For heart attack survivors who live alone, it increased their risk of survival by a whopping 33% compared to those who did not have a dog. 

Additionally, the AHA also found that many people who own dogs report having lower blood pressure. In 2013 they even stated that owning a dog is “a reasonable strategy for reducing heart risk.” Whether this is due to the increased physical activity that comes with owning a dog or the fact that our furry pals provide therapeutic and calming effects to their owners isn’t entirely clear, though. 

In general, doggie parents tend to have fewer trips to the hospital, suffer from fewer incidences of minor seasonal illnesses such as cold and hay fever, and are more able to cope with stressful events, helping them to avoid anxiety-related illnesses. Plus, while all children are susceptible to developing pet allergies, babies who grow up in homes that have dogs are much less likely to develop them than those who live in dog-free homes. 

Emotional Benefits

The most obvious thing to mention here is that dogs bring a sense of companionship to people. This applies both to people who live alone and those who live with others. The canine/human bond is something that has been studied for generations and, even after all this time, isn’t completely understood. Still, there is no denying the fact that there is a special bond shared between humans and dogs that is unseen in other pets or animal species.

Besides that, dogs also help to introduce structure into our lives. This can be especially helpful for both the very young and the very old who have not yet established, or lost, a normal life routine. How? Dogs have, for the most part, regular eating habits, regular bathroom habits, and regular sleeping habits. Think about it, have you ever looked at your dog sleeping on the sofa and thought to yourself that you should head to bed yourself?

And, of course, dogs help to relieve stress. It’s common for universities and colleges to set up a puppy room during finals week to help ease the suffering of overstressed college students. Students who interact with the dogs on campus report feeling less stressed and more capable of taking on the wave of exams and final essays they have in the coming weeks. 

Don’t think that this is some placebo effect, either: it’s science. When a person pets a dog, both creatures experience an increase in oxytocin. Oxytocin is the “love hormone” that we’ve all experienced at some point in our lives. It’s the same hormone that gets released when a mother holds her baby or when a couple hugs or kisses each other. It turns out that the same exact mechanism exists between dogs and humans when petting occurs.

Could you just imagine all the positive benefits that might occur if employers across the country started allowing their employees to bring their dogs to work? Granted, it might prove difficult for people to get anything done if there’s an extraordinarily cute french bulldog prancing around the office, but bringing pets to the workplace is not a new idea, and employers have been implementing it to varying degrees of success for years. This brings us to our next topic…

Can I Bring My Dog to Work?

Unfortunately, we can’t answer that question for you; you’re going to have to ask your employer! That being said, if your boss needs some convincing, there have been multiple studies that prove that having dogs in the workplace contributes to employees’ overall well-being. 

First, let’s examine overall stress levels and job satisfaction scores among employees who were allowed to bring their dogs to work. A study conducted by the International Journal of Workplace Health Management sought to compare two groups of workers, one who occupied a workplace where dogs were allowed and one where they were not. 

The study showed that there were significant differences in terms of overall work stress and corresponding job satisfaction scales between the two groups. 

And can you guess which group scored better? We probably don’t even need to say it, but yes, the dog group was found to have improvements in terms of “physiological and perceived stress, perceptions of job satisfaction, organizational affective commitment, and perceived organizational support.”

Secondly, dogs are a great way of attracting and retaining new employees. This is something that has been a huge problem for many companies as of late, with so many people leaving their jobs with the onset of the COVID pandemic. Well, as you may have guessed, having a solid pet-friendly workplace policy can, in fact, attract and help retain new employees. 

Even more impressive is the level of connection to the company that pet-friendly workplaces bring. In fact, 90 percent of employees who work in such environments said that they feel highly connected to their company’s mission and would recommend their employer to others. And what did those who worked in environments that weren’t pet-friendly feel? Big surprise: just a bit over half shared the same sentiment. 

Then let’s talk about communication (pun intended). Dogs are almost universally loved, even among people who don’t own one themselves. Studies have shown that dogs in the workplace greatly help to facilitate communication in a work environment. This is especially true among new employees who are struggling to find ways to fit in with the rest of their coworkers. Dogs are a wonderful way to find a common topic of discussion. 

Lastly, they may ease tension in otherwise stressful situations. Imagine there is going to be some sort of a heated negotiation in your office between your team and a group of potential clients. Chances are that both sides will go into the room with pent-up aggression before the first word even comes out of anyone’s mouth. But then, along comes a husky… a really cute husky… let’s call him Gildber. Would you be able to remain angry while petting Gildber? Yeah… we didn’t think so. 

Speaking of Which, Have You Met Him? 

This is Gildber, our resident husky, small business insurance wiz, and your go-to guide for navigating the complex and ever-changing world of small business insurance.

At Gild Insurance, we believe that finding the right insurance fit shouldn’t be a burden. It should be a positive experience, something that puts your mind at ease and makes you confident that you and your business are covered in the event that something unfortunate happens. 

That’s why the spotlight shines on Gildber. We think he just has this certain way about him that perfectly exudes what we’re trying to accomplish here. He’s fun, quirky, and cute, but also smart, practical, and full of knowledge from all of us here at Gild. He’s the quintessential example of what makes us different and what makes us better. 

We know that the key to success in today’s world is a balance of technology backed by a personal touch (hence, why we have Gildber). The nature of our digital business model means that you get greater access to the latest innovations. No longer do you, —as a small business, solopreneur, or freelancer—have to feel like you are the last priority. With Gild Insurance, you get the latest, first.

To learn more and to get started on your own personal insurance journey, why don’t you head over here and get to know Gildber a little better? Trust us; he’s not like some of those other company mascots that are all style and no substance. He really knows his *ahem* stuff, and you can count on him to take care of you and provide options that fit your business. (Oh, and by the way, give him a scratch behind the ears—he really likes that!)

Categories
News

We WORK And So Does Our Mascot

At Gild, we work as a team and every team needs a great mascot to rally behind. A mascot should be the personification of your team’s character and create a sense of pride, loyalty, and connection. When a working dog was suggested to represent the team here at Gild, it made perfect sense.

If you haven’t noticed, we take pride in the work. We believe in the independent, entrepreneurial spirit and are continually impressed by the courage and determination it takes to step out on your own, pursuing your vision. 

With that in mind, we’d like to formally introduce you to Gildber!

An homage not only to those enterprising individuals embracing their independent spirit, but also, to everyone that has their backs. Gildber and the entire Gild Community is here to remind you that independence is not a solitary endeavor. We got you.

Categories
Trends

Small is Desirable

In our blog post, Work The Problem Chapter 2: Commercial Insurance And The Small Business Problem, we highlight a major issue facing the small commercial insurance market, especially as pertaining to microbusiness, freelancers, and solopreneurs. That issue is pricing. 

Underwriting an insurance product to attain a price point adequately reflecting risk and acceptable to consumers is no simple feat. That concept holds true not only for the actual work involved in creating the products, but also, to the efforts necessitated to entice an insurance provider to develop the products in the first place. Just because millions of microbusiness, freelancers, and solopreneurs exist, does not mean they are wanted. 

The fundamental thought process that has been plaguing the smallest of businesses since the dawn of insurance and financial services remains the same. Small is equated with less. The less profit a business generates, the lesser the opportunity to make money offering that same business products. Though that statement may be factually correct, there is now an opportunity to expand the fundamental way microbusiness, freelancers, and solopreneurs are viewed, not only by the insurance industry, but really any industry with products that could support microbusiness, freelancers, and solopreneurs.

The perception that “small is less” becomes less relevant when one realizes that a single microbusiness is not only one of tens of millions, but also, that those tens of millions can actually be reached. All of a sudden a microbusiness, freelancer, and solopreneur isn’t just a single business on main street, it is a business on every main street. The Digital Age allows for connectivity and support mechanisms for millions of microbusinesses, freelancers, and solopreneurs, no matter the location, size, or industry, creating a viable subset of the small business market. This provides motivation to insurance providers, for example, to develop coverages customized to this market, the smallest of businesses.

In this shift of perspective lies the importance of the Gild Community. Together, we assist larger businesses, like financial institutions and insurance providers, to see the bigger picture. We work to shift the perspective.

Small is desirable.

We know you always knew small had merit. But now, that knowledge is being utilized to help millions of enterprising individuals and we thank you.

Categories
Insurance

Work The Problem – Chapter 2: Commercial Insurance And The Small Business Problem

The new digitally based economy not only changed the game on how consumers interact with businesses, it changed business itself. E-commerce platforms, social media, and mobile technology, to name just a few, provided resources to facilitate independence and with that, came a rise of microbusinesses, freelancers, and solopreneurs. 

In a country where small business is generally defined as employing less than 500 employees, let’s paint a more detailed picture:

  • 98% of the U.S. economy is made up of businesses with less than 20 employees
  • 87% of these businesses have no employees at all
  • 27% of the United States working age population, approximately 54M independent workers, have participated in the gig and sharing economy

Very clearly, microbusinesses, freelancers and solopreneurs dominate the economy. However, as these businesses are very aware, few insurance carriers specifically cater to their needs. This is evidenced by the estimated 50% of small business insurance customers open to switching insurance providers each renewal period. And the main underlying issue prompting microbusinesses, freelancers, and solopreneurs to switch insurance providers is…price. This failure in pricing is a failure to adequately tailor insurance coverings to these types of businesses. 

If you ask us, 50% of customers shopping around isn’t a resounding endorsement of the industry. So, ta-da! We found another problem to work; how to connect microbusinesses, freelancers, and solopreneurs to adequately priced insurance products.

Our solution – solely partner with insurance providers that specialize in microbusinesses, freelancers, and solopreneurs, with products designed just for them, priced just for them.  

Then, algorithmically match the microbusinesses, freelancers, and solopreneurs, based on numerous factors, via our wonderful chatbot, to the tailored insurance coverages. 

And done! You never have to wonder again if your insurance provider understands your business. 

Read the first post in this series, Work The Problem Chapter 1: Commercial Insurance And The Digital Sales Problem.