Get Free Auto Insurance Quotes Quickly & Easy

Insurance leverages a simple principle. If the client is a city or town, as another example, it may be more interested in the number of police cars or the number of miles of road in a particular town or county. If a client is in the technology industry, for example, he or she may look at how much time an employee spends typing on his or her computer each day, as one of the biggest claims in that industry is carpel tunnel syndrome. Different tools allow insurance companies to evaluate every exposure they insure. Tactics used to measure risk depend on the type of risk. In this way, a business is able to partner with its insurer to identify and then develop strategies to manage many of the physical and legal risks inherent in running a company. These commercial risks are assessed based upon the type of business, the nature of the operations, the size of the company and a variety of other factors. The insurance needs of a business are typically more complex than the insurance needs of an average person. My organization, the companies of Argonaut Group, provides financial protection for businesses through an array of insurance products and risk management services. It is impossible to completely eliminate risks, but it is possible to greatly reduce the financial impacts. Every company, large and small, faces an array of physical and financial dangers. With proper risk management tools, their balance sheets may face tremendous exposure.

For large companies, the question is not will there be a loss in any one year, but how many losses will there be in that year and how severe will those losses be? In a small company, the average premium may be a few hundred to a few thousand dollars per year, and the chances of having a claim may be slim. Small businesses require different approaches to risk management than larger companies. Sophisticated models and experience help insurance companies predict the frequency and severity of losses within a particular industry or class of business. They pool together the premiums of the group to pay for the losses of those few. Since none of us have a crystal ball, which might better predict who will have a claim, business can protect their balance sheets by sharing risk. The presumption is that some of these businesses will have a claim (or claims), but many of them will not. When a business buys an insurance policy, its goal is to spread the risk with a lot of other policyholders.