Types of Insurance for Any Small Business

Risks are part of operating any kind of risks. In fact, it is true to say that, an entrepreneur exposes him or herself to certain risks from the first day of conducting business. Many experts in matters insurance argue that businesses are prone to risks even before the hiring of the first employees. One catastrophic event is enough to wipe out the entire business before it gets off the ground. This makes it essential to have the right insurance in place.

With the current trend in the insurance industry, businesses all over the globe have access to a wide range of insurance products. In most instances, insurance companies offer businesses with products that can protect them against any kind of risk. Most insurance products focused on businesses cover fire, theft, pilferage, injuries while at work among other risks. Below are some of the insurance types that a business must have as soon as possible.

Property Insurance

Property insurance is very crucial regardless of whether a business owns or leases its space. This type of insurance covers equipment, signage, inventory, and furniture against risks that may occur due to fire, storm, or theft. Nonetheless, standard property insurance does not cover massive destruction like floods and earthquakes. It is necessary to check with your insurer the available insurance policies if your business premises is prone to massive natural risks.

Business Interruption Insurance

It is obvious that disasters or catastrophic occurrences are likely to interrupt business operations. During this time, a business is at the verge of losing a considerable amount of revenue due to inactivity. The business interruptions insurance is very effective when it comes to indemnifying the entrepreneur during such occurrences. Notably, this type of insurance compensates a business for its loss of revenue during disastrous periods. However, it is worth noting that this type of insurance is suitable for companies that require a physical location to do business. Online businesses may not be eligible for this type of insurance. After all, what natural calamity would affect their undertakings?

Workers’ Compensation Insurance

The worker’s compensation insurance policy should be added to the business’s insurance policy once the first employee is hired. This type of insurance covers medical treatment, disability, and death benefits of workers. This applies in the fateful event that an employee becomes injured or dies while on duty or still in a contract with the employer. This type of insurance is very essential even if the employees are performing seemingly low-risk jobs. Note that even a slip and fall injury can result in a very costly claim.

Professional Liability Insurance

In most instances, professional liability insurance is also known as errors and omissions (E&O) insurance. Professional liability insurance covers a business against negligence claims. The claims may be due to harm that results from mistakes or failure of the business to perform. Nevertheless, there is currently no one-size-fits-all insurance policy for professional liability insurance. There are a completely independent set of concerns for each industry. Insurance companies are now providing customized policies for businesses.

Product Liability Insurance

This type of insurance is mainly for manufacturers. Manufacturers of various products for sale on the general market are at risk of lawsuits due to damages caused by one of their products. In this case, product liability insurance is necessary. Even businesses that adhere to standard operating procedures in the line of production may have one defective product. This can cause a huge claim in case of damage or bodily harmed caused by the product.

Home-Based Businesses

In the US, many people start their businesses in their homes. Regrettably, homeowner’s policies do not cover home-based businesses. On the other hand, many commercial property insurance companies do. It would best to consult your insurer for additional insurance to cover equipment, inventory, and other business assets when operating from a home office. In case of a loss of either of these assets, the process of indemnification will be easier.

Vehicle Insurance

It is a legal requirement in all countries around the globe for all vehicles to be insured. If the entrepreneur intends to buy vehicles for business use, it will be a primary objective to get a vehicle insurance cover. This type of insurance policy protects the business against liability in case of an accident. Insurance experts recommend that a comprehensive insurance cover is the best type of vehicle insurance. In case employees use their personal vehicles for the business, their own personal insurance policy will cover them.

Having the right insurance cover helps a business to avoid major financial losses. It is ideal to consult your insurer to find out the best forms of insurance for your business. If you feel like the insurers are giving biased or exaggerated information (what most do to inverse sales), contact us for more clarifications. We are always happy to help!