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.