Due to the September 11th terrorist attack, insurance rates for both small and big businesses are set to increase in 2002! Even businesses not in areas affected by the terrorist attacks will see increases from10% to 30% or more. Hardest hit will be big businesses in metropolitan areas where business property premiums could increase by over 300% according to a report by industry analysts.

Besides the obvious losses sustained by insurers of office buildings like the World Trade Towers, rates are pushed higher by the many businesses, including small businesses, which had business personal property coverage as well as loss of business income coverage. Although the final loss numbers haven?t been totaled, insurance companies have already started increasing their rates on policies they are currently renewing. Finally, reinsurance companies, who insure the insurers, have sustained heavy losses and are therefore raising their rates.

Some insurance companies are leaving higher risk areas such as New York and other major cities. This reduction in completion further inflates premium prices.

Besides rate increases, companies are doing what they can to limit their exposure. Almost all companies exclude terrorist acts in their policies. Bush administration and congress jointly agreed on a terrorist bill that provides some protections to consumers that weren?t covered by terrorist provisions in their policies.

Industry experts suggest that small business owners meet with their insurance company?s representatives before their policies comes due. Some suggest shopping for insurance from other companies. Almost all experts agree that small biz owners should be proactive and wait to hear from their insurance companies, as this will limit their options.