5 Ways to Save on Bike Rental Insurance for Your Shop

Reducing operating costs can be crucial for the success of your bike rental shop. Some of your costs are pretty fixed: rent, utilities, payroll, workers’ comp, replacement parts. So, so many replacement parts.

But there is room to reduce your costs when it comes to insurance for your business.

When every dime counts, here are five ways you can save on bike rental shop insurance.

1. Carry the Right Coverage

Think of your bike shop insurance like your inventory of repair parts. You want to have enough on hand to meet the demands of your business, but you don’t want to sink all of your cash into unneeded stock that just sits on the shelves.

Some of the most common coverage for bicycle rental retailers includes:

  • General liability for third-party injuries or property damage
  • Workers’ comp for employee injuries (and to comply with state laws)
  • Commercial property to protect the assets inside your store
  • Inland marine to protect the assets that head out the door
  • Umbrella coverage to shield you from extreme accidents

How do you hit the “Goldielocks” zone of just the right amount of insurance coverage? Have an annual check-in with your insurance agent to go over your existing policies, limits, deductibles, and any changes to your business.
 

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2. Package Policies

One of the easiest ways to save money on insurance for your bike rental shop is to combine your coverage. Package policies are designed to bundle multiple risks into one affordable policy.

One example of a package policy is a Business Owner’s Policy (BOP), which typically combines general liability, commercial property, and business interruption insurance.

Many bike shops are now taking advantage of package policies designed specifically with their operations in mind: bike shop insurance. This package policy covers risks inherent to businesses that sell, rent, repair, and service bicycles and other outdoor sports equipment.

When you purchase a package policy, you get the benefit of the insurance coverage you need to protect your bike shop at a lower cost than piecing together your coverage policy-by-policy.

3. Hire Wisely

Employees can be one of the biggest expenses to a bike shop business, and not just in terms of payroll and workers’ comp.

Seasonal employees tend to be younger, inexperienced workers. This inexperience can lead to inventory damage, losses, or injuries that can impact your insurance rates.

  • A new hire may accidentally leave bikes out at night, resulting in a claim to replace stolen equipment.
  • A seasonal employee may botch a repair, leading to an injured customer and a liability claim.
  • A short-term employee may hurt themselves replacing a chain, bringing a workers comp claim your way.

While there’s often no way around the seasonal hire situation, there are ways to be sure you’re hiring the best quality seasonals available.

  • Conduct background checks.
  • Implement pre-hire drug screening.
  • Do your due diligence and check references before hiring.
  • Check driving records for employees who may drive your shuttles or company vehicles.

4. Establish a Safety Program

When it comes to insurance, the best way to avoid skyrocketing rates is to prevent accidents and claims.

According to OSHA, every $1 invested into a safety & health program can save your business $4 - $6.

Compliance with safety regulations plus a dedicated safety program can reduce your costs on employee-related accidents and injuries.

Don’t know where to start? Visit OSHA for recommended practices for health & safety programs.
 

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5. Examine Deductibles & Payment Options

Feel like you’re paying too much in insurance payments? Take a look at your deductible amounts. Generally, higher deductibles come with lower monthly or annual premium payments.

Increasing your deductibles is one strategy that may lower your premium amounts. But there’s a reason why we didn’t lead with this tip, and it’s this:

Increasing your deductibles should be done with caution.

Your deductible is the amount of money you’re responsible for paying before your insurance company will pay out on a claim.

If you increase your deductible to an amount that you can’t afford - or that will seriously damage your cash flow - you’re not doing your business any favors.

Imagine one of your customers rents out a bike. While she’s pedaling around your city, a bent fork leads to a crash. She falls and breaks her ankle. She takes an expensive ambulance ride to the nearest hospital and now you’re facing a claim for her medical costs.

If you’ve increased your deductible amount to lower your monthly premium payments, you could be faced with a hefty bill to pay for this unfortunate accident. If you can’t afford your deductible payment, then you’ll be hurting your business when you have to pay it out.

Another option to save on your premiums is to ask about discounts for paying an annual premium in full, rather than paying monthly premium payments.

Most insurance companies will offer a discount for an annual payment. Plus, then you wouldn’t have to concern yourself with making premium payments on time or missing any payments for the rest of the year. Which can be a big benefit for a seasonal business who wants to save every penny during the slow months.

Perfect Coverage = More Cash Flow

You don’t have to make saving money on your bike rental shop insurance complicated. Just pick up the phone and call a trusted insurance professional. At Aegis Insurance Markets, we specialize in Outdoor Sports Insurance programs, including insurance for your bike rental shop. We can help you get the right amount of coverage at the right price, putting more cash into your business and allowing you to focus on “gearing” up for more growth.

 

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Truckee, California 96161
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