Protect Your Buesiness With These 7 Types Of Insurance
Did you know that 1 in 4 businesses never reopen their doors after a disaster?! Likely because they simply don’t have the funds to do so. On the very first day you start your business, you open yourself up to risk, even before you hire an employee. It only takes one lawsuit of major event to wipe out a small business before it even has a chance to get going.
Thank goodness for insurance!
As a business consultant, one of my primary duties is to make sure my clients are protecting both themselves as owners and their business. Fortunately, businesses have access to a whole slew of insurance options to protect both owners and the business itself. Below are some types of insurance that businesses should have in place to protect everything they have worked so hard to create.
- Property Insurance
If you own or lease, property insurance is necessary! This type of insurance protects your equipment, inventory, signage, and furniture and fixtures in case of fire, storms or theft. Be aware that massive events such as earthquake or floods do not protect you under normal coverage on this type of policy. If you are concerned about such events, talk to you insurance provider and let them know you are interested in this additional protection. - Professional Liability Insurance
Also known as E&O Insurance, this protects a business against negligence claims due to harm that results from a mistake or failure to perform. Each policy of this type is different and there is no one size fits all. Each and every industry has its own issues and concern that will be addressed when customizing this type of policy. Fraud is also not likely covered with professional liability insurance. For example, if an employee were embezzling, you would need a separate policy to address that coverage. - Home-based Businesses
If you are like many entrepreneurs, you likely got your start out of a home. Unfortunately, homeowners’ policies don’t cover home-based businesses in the same way commercial property insurance does. Likely though, you would be able to add additional coverage to cover things like inventory and equipment specific to your business. - Workers’ Compensation Insurance
No need to worry about this one until you hire your first employee. Then it’s time to look around for this type of insurance. This will cover medical treatment, disability and death benefits in the event an employee is injured or dies while on the job or as a result of working at this business. While you might be thinking that your employees are only subjected to low-risk activities, even slip-and-fall and medical conditions such as carpal tunnel could result in an expensive claim. - Vehicle Insurance
All vehicles used in the course of business should be insured to protect a business against a liability claim if an accident occurs. If employees are using their own cars for business, their own insurance will cover them in case of an accident. A big exception to this is if they are delivering goods or services for a fee, such as with delivery personnel. - Product Liability Insurance
Is your business manufacturing products for sale? Then this type of insurance is a must. This type of insurance works to protect a business if the product being manufactured causes a safety issue with a consumer. - Business interruption insurance
If a catastrophic event or a major disaster occurs, would your business be effected? Likely. Your business will likely suffer from lost income due to your staff’s inability to get to work, make products, or make sales of those products and services. This insurance is especially important to businesses with a physical location.
Now that you have a list of specific business insurance that could protect you in case of a disaster, accident, or just bad luck, consider talking with your insurance adviser to see what he/she recommends for your type of business and your location.