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An Insurance Pricing Secret You Should Know

A credit-based insurance score could cost or save you money.  Ever heard of it?  In short, it’s a special score that an insurance company gives you or your business based on information it digs up in your credit file that determines what premium you’ll pay and in some cases whether you get the insurance at all.

Credit scores and insurance scores are not the same thing.  Not knowing the difference can cost you and your business money.  Both are derived from the same data, but are intended to predict different things.  Credit-risk scores aim to predict the likelihood you’ll default on a loan or other credit.  Insurance scores, however, are built to predict whether you are likely to file more (or less) claims with the insurance company than the average customer.

More and more insurance companies are now using credit-based scoring to screen customers and set rates.  All of the 15 largest auto insurance companies in the U.S. now use it. Even if your business has a good claims history, you could end up paying higher rates – or could be turned down for coverage elsewhere – if the insurance company doesn’t like what it sees in your credit file. 

For business owners with good credit, however, credit-based insurance scoring can be good news.  “Good credit can also reduce insurance premiums, since many insurers offer good credit discounts,” says Loretta Worters, vice president of the Insurance Information Institute.  A study in Oregon, for example, showed that auto insurance policyholders with a good credit-based insurance score paid as much as 48 percent less for coverage.   

Ask your insurance company or agent if you are getting the best rate and terms available. If you aren’t, find out why: It could be due to a poor insurance score.  If you are denied coverage or offered a higher rate, consider reapplying after your credit picture improves. The simple step of paying all your bills on time is your best defense against trouble caused by a low credit-based insurance score.  Find out more about insurance scoring.

Copyright © 2000-2011 BizBest® Media Corp.  All Rights Reserved.

5 New Keys to Cutting Small Business Health Insurance Costs

Health insurance remains as expensive, confusing and out-of-reach for most small businesses as ever.  If your business already has a health insurance plan, you probably know that costs keep rising.  And if you don’t, all of the talk about health insurance reform so far has probably only made your business even more befuddled.  And now this: A new survey by eHealthInsurance.com shows that less than 20% of business owners believe they’d find better benefits if they shopped for health insurance this year.

 But hidden in the health insurance fog are some valuable benefits and cost-saving opportunities – plus potential pitfalls you should know about.  Basically, small business owners who haven’t boned up on the latest changes could miss out on important chances to save money. Recent changes now in effect can help you get better benefits for little or no additional cost, including free preventive care screenings. There are also big-dollar tax breaks that can benefit some businesses with existing plans (see Claim your Small Business Health Insurance Tax Credit).

And here’s something else you should know:   Insurers in many states are looking to attract more small businesses and have started offering lower rates to new customers, which means your business may be able to save money by switching carriers this year.  Here are five key to getting the most from your small business health insurance right now:  

  1. Take advantage of recent changes: In addition to new small business tax breaks, health reform has mandated new benefits in plans now being offered that include preventive care screenings at no cost, and no lifetime limits on your health coverage.  But watch out:  If your business bought health insurance before reform passed in March 2010, your plan is probably “grandfathered” under the old rules and won’t provide the new benefits.  While the new benefits won’t lower your premiums, they don¹t seem to have increased prices for small group plans either.  And free screenings might head offer bigger health problems later, saving your business money in the long-run.  Plus, small business owners no longer have to worry about one employee’s illness maxing out the coverage on the entire plan.
  2. Customize benefits to costs:  Ask employees what benefits they really need and want, and construct a health plans that gives them only the benefits they are willing to help pay for.  (Always keep in mind, however, that it¹s illegal to ask employees to provide specific information about their health history or what kinds of benefits they use most.)  But, you can find out if they¹re interested in chiropractic care or dental insurance – benefits they could pay for on their own. You might also create an anonymous survey to find out what benefits they value most, or if they¹d prefer higher monthly premiums with low deductibles, or vice-versa.  
  3. Share the costs:  Consider the possibility of having employees contribute to monthly premiums, especially if they want broader benefits.  According to the eHealthInsurance survey, many small employers are still unaware that they can have employees share the cost of monthly premiums.
  4. Investigate new health coverage options:  More and more small business owners are exploring plans that include Health Savings Accounts (HSAs) and Flex Spending Accounts (FSAs).  Such plans often come with higher deductibles, however, which many employees fear.  Under many new plan designs, it is now easier for employers to contribute to an employee’s HSA account and eliminate that fear of a high-deductible, while still saving money.
  5. Shop for different insurers:  It’s tempting for time-pressed small business owners to shop once for a plan and move on.  And some business owners stay with a long-time insurance provider on the mistaken assumption that their favorite doctor or hospital only accepts the plan they have. But it’s a good idea to re-shop for coverage every two or three years to be sure you¹re still getting the best deal.  Big companies switch all the time to save money, and you should too. 

Copyright © 2000-2011 BizBest® Media Corp.  All Rights Reserved.

Rules and Benefits of Employee Credit Cards

Sooner or later, growing businesses face this decision:  Should certain employees have their own company credit cards?  While many biz owners are psychologically opposed to issuing plastic to employees, business credit cards can actually be big time and money savers.  They greatly reduce the number of checks you have to write, provide detailed and itemized expense documentation, and reduce the frequency and cost of employee expense report reimbursements.

They can also save the day.  Say, for example, you have a big presentation first thing tomorrow morning. You send your key employee to pick up the finished presentation materials at the printer, which closes in an hour. Your employee shows up with a signed check for the original quote, but the final total is higher.  What now? If your employee has a business credit card, you wouldn’t have to cut a check in the first place, and there’d be no problem.

Still, there are a several factors to consider when entrusting employees with a business credit card.  Here are three rules that business owners should consider when issuing company cards:  

  1. Set spending limits:  Often, the best way to prevent credit card abuse among employees is to set tight spending limits and “merchant category codes” (MCCs) to limit areas in which employees can spend money on the card.  For example, American Express offers MCC blocking of 281 standard individual and 28 proprietary predefined groups of codes.  By using this feature, business owners can allow employees to spend only with merchants in specified categories. You can also link card holders to a list of MCC codes and enable them to spend at any establishment other than the merchants in the codes listed. You can even restrict spending to specific merchants or locations by using Preferred Supplier Lists.
  2. Issue guidelines and a written company policy:  In other words, do not assume employees know their limits when it comes to credit card spending. Ask employees to read and sign a written agreement that states compliance with the company’s rules for using credit cards.
  3. Review statements regularly:  Regardless of trust in employees or any signed company policies, it is important to remain aware of employees’ spending.  Conduct regular reviews of credit card expenses. It’s easy to do online where you can see precise details of every transaction.  Also ask employees to provide receipts and to reconcile their spending monthly.  Immediately bring any questions or concerns to the employee’s attention.
  4. Capture points and rebates:  Using company credit cards is also a great way to consolidate business purchases, earn points and capture extra discounts. 

For free comparisons of business credit cards that can help your company expand and save money, visit the business card section at CreditDonkey. You can search, compare and apply on the website, finding the best business credit card for your needs.  Card issuers, such as American Express, sometimes offer extra cards on existing accounts at no additional charge for business customers in good standing.

Copyright © 2000-2011 BizBest® Media Corp.  All Rights Reserved.

Great Free Sites and Software for Small Biz

1. Home Office Suite: For many solo and home-based businesses, the $279 Microsoft Office software suite is overkill. As a free yet powerful alternative try OpenOffice.org from Sun Microsystems. You can download for free, and it comes with word processing, spreadsheet, a draw program, database program and presentation software.

2. Free Invoicing for FreelancersBillingBoss.com is a free online invoicing tool designed for small business owners and freelancers to create, send and track invoices. It’s easy to use and you can create your first invoice within minutes of signing up.  If you’ve been getting by with spreadsheets, or use complicated accounting software only for its invoicing tool, BillingBoss might be for you. Unlike some free services, there’s no limit on the number of invoices you can create or send with Billing Boss. You can also set it up so customers can pay you online through Billing Boss. There’s also comfort in knowing this service is run by one of the world’s leading business software companies, and that your information is encrypted and securely stored.

3. A Virtual Office Online: Microsoft (http://officelive.com) is a free password-protected online workspace where you can store and share files and access your work from anywhere, even from other computers.  Its companion site Office Live Small Business is a terrific, affordable place to build a professional-looking online presence, and get a free website and marketing help as well.

4. Customize Your Own Free Software and Tools Package: Google Pack is new from the global search giant. It lets you customize and download you own set of free software and web tools that includes everything you need to work more effectively both online and off.  Dozens of  choices – all free – include:

  • Email, calendar and document creation applications.
  • Anti-virus and spyware protection.
  • Photo editing and sharing tools.
  • Skype for making free voice and video calls via the Internet.
  • Adobe Reader to view, print and search PDF files.
  • Google Talk to connect with friends via instant messaging (IM) or free voice calls.
  • A media player that lets you play and organize your music and videos.

5. Manage Your  CustomersFreeCRM.com is a great tool for small business contact and lead tracking, sales and contact management, sales forecasting, customer service and business management.  The free version is self-service, allows unlimited users and provides up to 10 MB of storage. If your customer base is not particularly large, it can be a quick and easy way to automate your sales, do a better job of tracking leads and even manage email and call campaigns.

6. Free Bookkeeping: QuickBooks Online Free is a simplified, free version of the QuickBooks accounting and bookkeeping system for small business. While it lacks the more powerful features of QuickBooks’ other versions, it still packs a nice punch for a solo business. You can instantly create invoices, track your money and manage up to 20 customers. The “easy accounting” features of QuickBooks Online Free are designed for people who don’t know anything about accounting. It helps you get and stay financially organized by gathering your important information in a central place. Your information is then available to you anytime, anywhere via the Internet.

Copyright © 2000-2011 BizBest Media Corp.  All Rights Reserved. 

Surprise Truck-Buying Tactics that Can Save you Thousands

Need a new pickup or other truck type for your business? Sometimes the advice we’ve “always heard” about something turns out to be only partly right, or not right at all, and in fact can end up hurting instead of helping our cause.

Advice on negotiating the price of a new truck falls into this category.  Here are three “surprises” that might turn some of the things you’ve heard in the past on their head:

Surprise #1:  Offering to pay cash will NOT get you a better deal.

Most biz owners are conditioned to believe they can squeeze out a better deal on almost anything by offering to pay in full, immediately.  That might be true for most things, but when it comes to buying a new truck, it could be a big mistake.  According to Jonathan Rivers, of the website BillShrink, what dealers don’t tell you is that they often receive fat bonuses for arranging financing.

Thanks to those kinds of behind-the-scenes incentives, dealers have dumped the old adage “cash is king” and developed a new saying:  “cash is trash.”  Says Rivers, “You are more likely to negotiate a lower selling price by financing (and enabling the dealer to collect his bonus) than by paying for the vehicle outright.”

Surprise #2:  The “dealer invoice” price might NOT be the dealer’s real cost.

Common wisdom says that truck buyers should check the “dealer invoice” price for any vehicle they are considering.  The invoice price is what the dealer paid the manufacturer for the vehicle (including all options).  By contrast, the manufacturer’s suggest retail price (MSRP) is the “sticker” price that includes dealer markup.

But for most vehicle makes, the published invoice price is not the true dealer cost because of something called “dealer holdback.” Holdback is a portion of the sale price, typically 2-3 percent of either the invoice price or MSRP, that the manufacturer returns to a dealer, usually on a quarterly basis as a way to boost the dealer’s cash flow.

Surprise #3:  You are not always destined to pay all “delivery” charges.

One of the “other” costs of buying a new business vehicle is the so-called “destination charge.”   This is a non-negotiable fee set by the manufacturer that covers the cost of shipping the vehicle to the dealership.  It’s a fixed number, regardless of whether the dealer is 10 miles or 10,000 miles away from the factory.

But here’s the surprise. While this may also be called a “delivery charge,” under no circumstances should you pay a destination charge AND a separate delivery charge that a dealer tacks on.  One charge is required; the other is just padding and you should ask that to be erased.

Copyright © 2000-2011 BizBest Media Corp.  All Rights Reserved. 

A Way to save Big on Business Banking

Millions of small business owners could be paying less for loans, lines of credit and business checking accounts, and earning more on savings, but aren’t taking advantage of it.

Thanks to rule changes that have loosened membership rules and opened the doors to more small businesses, more business owners now qualify to join a credit union (CU).  Yet public perception of what credit unions are, what they offer and who can do business there is foggy at best.  Credit unions work much like banks. Basically, CUs provide the same services but charge less for loans, pay more on savings and have far fewer fees.   When you open an account you become a “member.”  That’s why they talk about “joining” a credit union rather than simply opening an account at one.

And while you have to be “eligible” in some way to join a CU, there dozens of ways that can happen simply by living in a certain area, working at a certain business, attending a certain place of worship, or belonging to an organization.  The biggest attraction is better rates and lower fees.  Anything the credit union makes in “profit” is passed onto members (that’s you) through higher rates on savings, lower fees, and lower rates on loans.

Each credit union serves what’s called their “field of membership” – that’s the commonality between the members. You may be eligible to join a credit union based on your:

  • Geographic Location: Many credit unions serve anyone that lives in a particular geographic area
  • Family: Most credit unions allow members’ families to join. So if someone in your family is already a member of a credit union, you may be eligible too.
  • Membership in a group:  This includes churches, school s, alumni associations, and homeowners’ association.

To find credit unions you may be eligible to join, visit FindaCreditUnion.com, or cuonline.ncua.gov.

Copyright © 2000-2011 BizBest Media Corp.  All Rights Reserved. 

How to Save Big on Printing Costs

Most small companies and home offices can easily save a bundle on paper, ink and toner with innovative new software plug-ins that cut costs and waste associated with printing.  “This simple yet powerful exercise reduces print volume by an average of 17-25% and saves an average of $80-$120 per employee per year,” says Hayden Hamilton, co-founder of GreenPrint, a software firm focused on printing efficiency.

Avoid printing blank or useless pages from the web: Everyone who’s tried to print something from the web knows that what comes out of the printer is often very different from what appeared on your screen.  Often you’ll get multiple pages with nothing or next to nothing on them.  The solution is software that automatically configures web-pages to let you grab and print only the parts that you want.

Free web-friendly-printing downloads are available from HP and Canon.  HP’s Smart Web Printing plug-in for Windows works with your browser and lets you quickly select and clip, or select and print web pages just the way you want them, eliminating surprises that waste ink and paper. To find it, go to www.hp.com and search for “Smart Web Printing.”

Easy-WebPrint from Canon (www.canoneasywebprint.com) is free and offers even more features. Easy-WebPrint is a browser toolbar that lets you perform all of these money- and time-saving functions:

  • Automatic and manual scaling to avoid cropped web page printouts
  • Duplex printing
  • Selecting print preview pages to print
  • Printing a single page, or building a list of pages to print all at once
  • Standard or high speed printing with just one click
  • Multi-column printing
  • Optional printing of page backgrounds

Portland-based GreenPrint offers other money-saving solutions for home use, small businesses and big companies as well.  Visit www.printgreener.com.

Copyright © 2000-2011 BizBest Media Corp.  All Rights Reserved. 

Free Phone Calls for your Business

Want to save hundreds or even thousands on business calls yearly?  Try Google.  Yes, you read that right.  Although it’s not top-of-mind for phone calls, the Internet search giant – which already offers a broad menu of free and low cost small business solutions – has quietly introduced free phone service to the U.S. and Canada, plus super-cheap international rates.

It’s available through Gmail, Google’s wildly popular (and free) email service and works similar to Skype and other voice over Internet (VoIP) phone services…only better.  “It’s difficult not to like Gmail voice calling,” says James Martin, co-author of Getting Organized in the Google Era, “if only for the free calls and the convenience of making and receiving calls directly from my email inbox.”

Gmail voice chat (as it’s called) beats Skype in several ways.  First off, to make free calls with Skype both parties need to be using the Skype software on a PC or other device. Gmail voice lets you direct dial to anyone’s landline or mobile phone in the U.S. or Canada for free (at least for now).  And early users of the Gmail service say sound quality is good.  (Many business owners have dropped VoIP and Skype because of erratic sound quality.)  Call Australia, Argentina, France, Germany, Greece, China, Italy, Japan and more countries for 2 cents a minute (see all country rates at www.google.com/voice/rates).

Here’s how it works:

  • Calls are made directly from a Gmail inbox.  If you don’t yet have a free Gmail account, go to Google to sign up. To add the voice chat feature (which includes free video chat, too), download and install the free “plug-in” that enables the service to work on your PC, laptop, mobile phone or other device. Once that’s installed, you’re ready to make phone calls from the Gmail page using the microphone, speaker and camera already built into your computer.
  • One catch is that you’ll need a Google Voice phone number (free) in order to receive (but not make) phone calls via Gmail. Google Voice is a handy service many small businesses already use that enhances the existing capabilities of your phone, regardless of what carrier you have, for free.  It gives you a single number that rings you simultaneously on your office, home, mobile or other phone, plus online voicemail with transcribed messages delivered to your inbox.  If you get a Google Voice number, people can call you on that and you can answer on any of your regular phones, or in Gmail.
  • For more information or to sign up, go to: www.google.com/chat/voice/
Copyright © 2000-2011 BizBest Media Corp.  All Rights Reserved. 

Capturing Rebates on Business Purchases

If you’re like many business owners, you’re often too busy to bother with jumping through all the hoops to secure rebates on business-related purchases – especially technology.  By following a few simple rebate rules, and expanding your rebate universe, your business can recoup thousands per year – tax free (the IRS doesn’t count this as income).  Here’s your plan:

1)      Work the Web: RebatePlace.com is a great site to find rebates, compare prices and save money.    Search for available rebates by product category, manufacturer or keyword.  Sign up for their free newsletter and have rebate offers delivered to your inbox. Cars.com has a special section for rebates and financing offers which you can access from the homepage.

2)      Let ‘em come to you:  If you take the time to look, rebates are everywhere.   Sign up for rebate programs run by large chain stores and companies whose products you buy regularly for your business.  For other companies, try visiting their website and searching for “rebates.”   Many companies offer free e-newsletters that often include rebate offers, including: www.3m.com, among others.

3)      Go pro (active): Whenever you shop, either online or in-store, actively look for rebate offers. Staples.com, for example, has a section at the bottom of its homepage called “Ways to Save” that includes a Rebate Center where you can find rebate offers, as well as submit and track them.

4)      Play the competition: Always check competing brands which frequently offer rebates to lure customers of other companies to their side.  For example, automotive items that you replace often are fertile ground for rebates, including oil, filters and antifreeze.

More and more companies now let you apply for rebate offers online, thus eliminating the hassle and expense of filling out forms and mailing them in. Check the offer for details.

Copyright © 2000-2011 BizBest Media Corp.  All Rights Reserved.