Most entrepreneurs are optimistic by nature, fast-paced, and risk-averse. They're not the type to slow down and think about the bad things that could happen. But if you own your own business, everything you've worked so hard for depends on your ability to protect it from damage.
Table of Content
1. What's The Worst Thing That Could Happen?
2. Types of Insurance Coverage for Businesses
3. What Insurance Agents Can Do For You?
What's The Worst Thing That Could Happen?
The fact that you can imagine it means it could happen.
- A patient gets sick from a dish you prepared.
- A customer visit and falls in your store.
- Fire damages your office building.
- An employee picks up a customer at the airport and has an accident on the way home.
- A former worker accuses you of firing them unfairly.
- Heavy snowfall causes a roof to collapse, bringing work to a standstill for three days.
- Someone claims that your advice was not followed by the client and caused damage to the business.
Many contractors don't consider these possibilities or the total cost and decide to take the risk and waive the premium. However, this is a risk that should not be taken. The right type and level of insurance can protect your business from being destroyed by these adverse circumstances.
Types of Insurance Coverage for Businesses
Insurance needs vary widely depending on the type of business, but here are some of the most common types of insurance for businesses. Property insurance covers damage to your premises and the property (e.g., inventory, furniture, computer equipment).
- Liability insurance protects your business against legal action resulting from damage to other people's property for which you are responsible.
- Business liability insurance combines property and liability insurance into one package. It is an affordable way to protect your business, although there are restrictions on the type of insurance.
- Product liability insurance protects manufacturers and retailers from legal actions resulting from using their products. In today's litigious society, sellers of clothing, toys, tools, building materials, electronics, and even pet food may be affected.
- Workers' compensation insurance is a legal requirement in all states except Texas. It protects businesses from lawsuits related to workplace injuries and compensates injured workers for medical expenses, compensation, and lost earnings.
- E&O insurance is important for virtually all businesses that provide services for a fee, from doctors and lawyers to advertising agencies, wedding planners, computer consultants, and more. E&O insurance covers mistakes your employees make or your clients think you may have made.
- Business interruption insurance ensures you are covered against loss of income resulting from damage that temporarily stops or limits your business, such as a roof collapse or computer system failure.
- Auto insurance is essential if your business uses a car, van, tow truck, or other types of vehicle to transport or deliver goods.
What Insurance Agents Can Do For You?
Most independent insurance agents offer a free risk analysis of your business and will work through a series of scenarios to determine your business' weaknesses. They can then recommend the type of insurance you need and the amount of coverage. Don't settle for too little coverage, such as $250,000 in property insurance for a warehouse worth more than $500,000.
Final Thoughts
A good business insurance broker Brooklyn will also help you develop a strategy to reduce your company's insurance premiums as much as possible without reducing coverage. For example, you can reduce your monthly premiums if you choose a higher deductible (the portion that must pay first before the insurance covers the rest of the loss).
