Whether you are starting a new business or launching a new product, a crucial part of the preparation process is ensuring that your business is protected. There are many risks associated with running a business, and business insurance helps to put measures in place to reduce your costs and losses if something goes wrong with your business.
There are many types of business insurance, and not all of them will be applicable or necessary for your business. So just as much as it’s important to know what you do need, you also need to know what you don’t need to spend money on.
Business insurance exists because of risk, so let’s look at each type of risk that your business faces, and what insurance policies help to mitigate said risk. Once you can identify which risks your business faces, you’ll know what kinds of business insurance you need to choose.
Risk 1: Injury or Death Within Your Business or On Your Premises
The first risk that businesses face is the potential for someone to injure themselves on your premises or while using your products or services. This could result in a lawsuit against your company, potentially costing your business substantially.
For Employees: Worker’s Compensation Insurance
Protecting your employees from injury at work can be done with worker’s compensation insurance. This type of insurance covers costs associated with bodily injury and recovery costs.
It’s also a requirement for businesses employing staff in many states across the country - so it’s important to check that you have the appropriate coverage required.
For Customers: General Liability Insurance
General liability insurance protects your business against any claims made by customers who injure themselves on your property, in your store or using your products.
Risk 2: Lawsuits Based On Errors Made By Your Company
Another risk businesses face is the potential for lawsuits filed against them on the grounds of errors made on their part. To avoid having to pay out on this kind of claim out of your own pocket, you can take out professional liability insurance.
Professional Liability Insurance
Professional liability insurance, or Errors & Omissions insurance, covers your business if someone alleges that your company has made an error or failed to perform adequately. This kind of insurance is crucial for any service provider to have.
Risk 3: Damage To Your Property Or Business Assets
Lastly, there is the potential for physical damage, against your property or business assets. The costs of repairing and replacing assets can be huge, and frustrating especially if it isn’t your fault. Having insurance in these areas gives you peace of mind that you’ll be able to recover in the event of damage. Let’s look at each in a little more detail.
For Your Property: Property Insurance
Property insurance covers the buildings you operate in, from offices to stores and warehouses. If there are things like break-ins, natural disasters or accidents on your property, insurance helps you pay for repairs.
For your Assets: Commercial Insurance
For things like vehicles and other business assets, commercial insurance helps to pay for any damages or malfunctions with them.
Insurance is absolutely essential for businesses, and can save you a lot of money in the long run. So choose wisely, and make sure you’re covered.
