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Owners also have to understand the nuances of business interruption coverage, which can include waiting periods, co-insurance requirements and provisions for civil authority bans, when certain areas are declared inaccessible after a disaster. Many small businesses chase prices without understanding what they are giving up, Klein said. At renewal time, they may get sticker shock and ask for a premium reduction, but they don't always understand there are trade-offs for a $300 or $3,000 policy reduction, he said. He recommends owners read their policy carefully, not relying solely on the summary of costs or summary of coverages.
Conduct an annual review and include inflation in business valuation and property replacement cost estimates.