Selecting the types and levels of insurance is vitally important to a small business owner seeking to avoid day-to-day liability risks. So an owner should follow some general insurance guidelines if he or she wants to take full advantage of the protections purchased.
To start, consider obtaining an unexecuted copy of the policy before agreeing to coverage. It is well known that premiums for exactly the same coverage can vary significantly among insurance companies. However, what is less known is the fact that policy provisions (i.e., coverage and exclusions) can also very widely from company to company.
Insurance policies are form (or adhesion) contracts. Don't expect the insurance company to negotiate the language of various clauses. The insurance company is making a "take it or leave it" offer for coverage.
Obtain an unexecuted copy of the policy, read it thoroughly, and if the coverage is too narrow or the exclusions too wide--"leave it!"
Comparison shopping is ideal. However, don't limit this to a comparison of premiums and don't accept the insurance company's (or an agent's) word as to the policy's coverage and exclusions.
Request policies from several companies and compare the policies, in terms of coverage and exclusions, as well as premiums. If there is no existing policy, this is best done well in advance of the time coverage is needed.