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Insurance companies evaluate potential customers by looking at the risks inherent in their businesses. If the business appears to have a higher degree of risk, that business will pay more for premiums or may have difficulty getting coverage at all. The key is to reduce the risk that a loss will occur.

Fire risk is one of the main factors in determining the cost of property insurance. Building or leasing a fire-resistant building should reduce premiums significantly. You also should make it a point to keep your premises neat and tidy. A location with piles of boxes and debris, for example, is a much higher fire risk.

Here are other ways to reduce risk:

•Check smoke detectors on a semiannual basis and maintain written records.

•Maintain all fire safety equipment.

•Maintain emergency lighting and illuminated exit signs in proper working order.

•Develop a daily inspection routine of the premises, taking immediate steps to correct any hazards.

•Avoid overloading electrical outlets.

•If you live in a flood-prone area, determine whether your property is above or below the flood-stage water level.

•Know the history of flooding in your region, the warning signs of flooding, and the items you need to be prepared.

•Keep disaster supplies on hand.

 

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