Wednesday, January 3, 2007

Blanket Insurance For Businesses

Blanket Insurance is an insurance policy under which more than one property can be insured in more than one location. When you purchase a blanket insurance policy, you need not to specify the items covered under the insurance, as everything under a property is covered. Blanket insurance is not used to insure just property, but also things like the health of employees, theft in a particular establishment etc.

How to Get Blanket Insurance:

There are some basic requirements that you have to fulfill before you ca opt for Blanket Insurance.

1) List the Items

You need to draw up a Statement of Values stating the value and name of the items that are going to be covered by the Blanket Insurance. The SOV states the name of the item and its location.

2) Coinsurance

If you have insured property at various locations, one major problem arises at the time of payment for any accident or damage to the property. The limit of the property under Blanket Insurance needs to be looked into. If the value of the damaged property is more than what is offered under the terms of blanket insurance, then you will suffer a loss. You must remember that insurance companies keep in mind the cumulative value of the properties and items you are insuring, not the value of one single item.

What You Must Know Before You Opt for Blanket Insurance:

1) Agreed Value

Agreed value is the value that both insurer and the insurance company agree on while drawing up a blanket insurance plan. You must be very careful while stating an agreed value, as you cannot invoke the coinsurance penalty and get the insurance limit changes at the time of payment.

2) Varying Rules

Before opting for a blanket insurance cover, you must remember that different insurance companies have different rules regarding blanket insurance. Since insurance must be done on many items and properties, all under a single limit, many companies are reluctant to do it.

3) If your property is located in many different regions, then getting a blanket insurance cover becomes difficult. In fact, you may need to use many different blanket insurance covers for properties in different states and countries.

4) Blanket Highest Rate

The highest blanket rate is calculated based on the highest value item under the items covered by Blanket Insurance. This type of Blanket Insurance can be expensive.

5) Blanket Average rating

The individual values of the items covered under blanket insurance are added, and then divided by the insurance limit. The resulting amount is called Blanket Average Limit. This is cheaper than Blanket Highest Rate premium.

Many people blindly sign for blanket insurance covers, thinking it will protect all their property against any kind of loss. Before signing, you must read the fine print, and keep the above points in mind. If you find it difficult to choose a Blanket Insurance cover for your business, you can consult a small business consultant or an insurance agent.

Alexander Gordon is a writer for - The Small Business Consulting Community. Sign-up for the free success steps newsletter and get our booklet valued at $24.95 for free as a special bonus. The newsletter provides daily strategies on starting and significantly growing a business.

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