Small business ownership is about optimism and taking risks. Small businesses are often unable to access smooth credit, continuous innovation and smart business management which are essential for their survival. A globalized world makes it harder for small businesses to survive and prosper. They are now more susceptible to closures and risk than ever.
Comprehensive insurance is essential for every business as it provides security and protection. Small businesses can use it to increase their financial security. A small business can’t afford to take on a risk, but insurance covers that risk at a low cost. They can also afford the small premiums they can afford. If their owners take the time to review small auxiliary items like insurance policies, they can save hundreds or even thousands of dollars.
There are many types of insurance coverage.
Insurance requirements can vary greatly from one company to another. Here are some policies that business owners should be aware of in order to protect their business.
Insurance for business property
A broad type of insurance that covers small businesses is called business property insurance. It protects them from many losses, including damage to their buildings, tables, chairs, tables, and equipment. Floods and earthquakes are examples of natural disasters. All-risk policies can be well-structured to cover the hardware and software, valuable records, and income loss.
Small businesses can lose many things, and it can happen quickly. Many small business owners own restaurants, lodgings, retail outlets, and other businesses. The 2009 Great Britain/Ireland floods will be etched in the hearts of many. Many small business owners learned that everything can be destroyed in a flash.
Liability insurance
In today’s litigious world, liability insurance is an important type of coverage. There are typically four types of liability insurance:
General liability insuranceThis type of insurance is the most commonly used. This type of insurance covers injury or property damage caused by customers, vendors, or visitors to the premises due to negligence or willfulness of employees.
A customer or vendor might trip over or fall on torn or folded carpet, causing serious injury. This person could require surgery that may cost business owners hundreds to thousands of dollars. This may not pose a problem for large businesses but it could be for small businesses.
Indemnity insurance for errors and omissions Also called as professional liability insurance, errors and omissions insurance is essential for service based businesses. This insurance protects professionals against personal claims for causing injury while performing their duties. This insurance is for professionals who require high standards of care like dentists, financial advisors or attorneys.
Insurance for product liability: This type of insurance is very important for small businesses involved in manufacturing. It covers the business in the event that an item manufactured is liable for injury, death, or accidental damage to the user.
Employer-related liability insurance Sometimes dissatisfied employees bring inappropriate claims asserting discrimination (age, sex, race, disability, etc.Other employment-related issues include sexual harassment, wrongful termination, and sexual harassment. The coverage of employment practices liability insurance protects small businesses from claims by former employees and potential employees.
Excess liability
Umbrella insurance, also known by excess liability insurance, offers additional coverage beyond the underlying policy. It can provide coverage for medical costs and other claim payments up to the limit of liability insurance.
Workers’ compensation
The employer is generally responsible for any injuries suffered by employees at work. Therefore, the employer should ensure that the employees are taken care of. Workers compensation coverage should be available even for small businesses that employ one employee. It covers employees who are hurt at work and pays for their medical bills.
Business Income Insurance
Small businesses can get business income insurance, which covers them for disability. In case of an insured loss, business interruption covers employees who are temporarily unable to work due to the covered loss. It also covers business operations expenses and profits until the business is able to return to pre-loss condition.
Auto insurance
Small businesses that use automobiles, such as trucks and cars, must have auto insurance. It covers damage and theft, as well as third-party bodily injury and property damage claims.
Life insurance
For small businesses that have more than one owner, life insurance is essential. The life insurance policy pays for the buy-sell agreement in the event of death of a business partner.
Insurances that are not listed here
Other types of insurance policies are available to small business owners, such as health insurance for employees or certificate of insurance from the landlord (for rented and leased office space) to help protect the business from being closed overnight.
While the above list may seem overwhelming, small businesses do not need all of these insurance policies. Smart business owners should contact a leading insurance brokerage house to review the business requirements and to create an insurance policy that is tailored to their needs.