The Value of Insurance

On Feb 12, 2025

By Christine O’Brien, President, ICNJ

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For the best protection, afford you and your business ‘the best you can buy.’

As the President of the ICNJ, I consistently espouse one basic tenant about insurance: you are purchasing coverage to protect your greatest assets, so afford yourself and business the best you can buy. This may sound like an expensive prospect, but the value of this investment offers protection and peace of mind.

As business owners and executives know, assets encompass numerous things such as employees, brick and mortar, property, inventory, equipment, and the livelihoods of the human engine that creates a successful business. Regardless of the size of your business, insurance covers everyday risks to large-scale catastrophes.

To put the scope of P&C insurance in New Jersey into perspective, consider the most recent data from 2023 as compiled by the Insurance Information Institute:

• Incurred losses (claims/benefits paid to policyholders for covered losses plus the amount set aside to pay future claims that have occurred but not yet been settled) totaled $17.9B. That is a lot of claims paid to assist New Jerseyans. 

So how do businesses assess their risks and put in place measures to mitigate losses? It is a daunting task since the scale of risks continues to expand. No longer are general liability, property, and income protection the primary concerns. Cyber security, data breaches, brazen theft, business interruption, increased weather-related events and lawsuit abuse all must be taken into consideration when purchasing the right amount and type of insurance coverage.

Purchasing the right insurance requires a partnership mindset and the realization that it should not be a complicated process. Policy language and terms can be complex, but working with an insurer directly or with an agent or broker can bring a greater understanding of one’s insurance needs. 

Knowing the difference between an insurance agent and broker can be helpful. An agent can either be independent or “captive,” the former having a relationship with multiple carriers and the latter being affiliated with a single insurer. Regardless, agents specialize in selling insurance policies and represent the insurer with the ability to process the paperwork, complete the sales transaction and bind coverage.

An insurance broker represents the customer’s interest and acts as an advisor, working with various insurers to help find the right coverage. They provide advice on various policies and options, but do not process the paperwork associated with securing the policy and do not bind coverage.

Whether a new business is positioning itself to open, a small business is looking to expand, or a large corporation is shifting its priorities, knowing how to buy the right amount and type of insurance is crucial. Remember that insurance is about protecting your greatest assets. 

To access more business news, visit NJB News Now.

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