No matter how small or big, running a business has its unique challenges and risks. Business owners usually worry about regulation and compliance, hiring the best people for the job, market analysis, sales performance, and financial management. But they are also concerned about situations that could easily put them out of business. This is where Business Insurance can help.
As a coffee shop owner, for example, you probably put importance on safe packaging and serving of hot drinks to prevent accidents that may cost your business money. Or as a medical professional who owns a small clinic, you might be wary of giving medical advice that could result in a legal complaint.
No matter how careful you are, however, accidents like fire, theft, and similar scenarios beyond your control can happen. To help manage uncertainties in business and to protect your livelihood, you might want to consider getting business insurance.
Protect Your Business Against Risks
Businesses are prone to various risks which can happen anytime in any form. This is where business insurance can help you. As there are many risks that businesses face, it makes complete sense to protect your means of livelihood. Business insurance can help protect against the following categories of business risks:
- Uncertainty-based — risks due to unforeseen events; this may include:
- Natural disasters like fire, explosions, storm, and flooding
- Loss of suppliers that results in business interruption
- Financial loss due to theft/burglary
- Changes in legislation and regulation
- Cyber incidents such as data breaches and IT failure, which could compromise digital assets and confidential data
- Tax liability in the event of an investigation
- Machinery and equipment breakdown
- Computer and electronic equipment damage
- Hazard-based – risks from injurious actions; this may include:
- Accidental damage on someone’s property
- Slips, falls, and other mishaps resulting in injury within your premise (known as public liability)
- Faulty products that could lead to a lawsuit (known as product liability)
- Faulty service or advice (known as professional indemnity)
- Management liability such as employment issues, embezzlement, intellectual property and competition breaches, and others
- Other human error covered by the insurance
Types of Business Insurance
Business insurance offers a myriad of covers depending on your needs and the associated risks to your business. Here are the common types of insurance that your business may need:
Product Liability Insurance
This is recommended if your business entails designing, producing/manufacturing, supplying, and installing any physical goods and products. This type of insurance protects you in case the products you sell cause harm or damage to people and property. It can also cover you for any claims of defective products or faulty installations.
Public Liability Insurance
If you own a publicly-accessible establishment or give your services in a public space, this type of business insurance is for you. The cover protects you in the event of injury or property damage/loss that happened within your premises. The cover applies only to damages or injuries obtained from the physical environment and not from the services you provide.
Professional Indemnity Insurance
This is recommended for those whose business involves providing professional services. The insurance covers against mistakes such as incorrect advice and claims of poor or damaging service.
Cyber Liability Insurance
This type of insurance protects online businesses and other businesses that utilise digital technology. Many businesses nowadays rely on computer and internet for communication, data storage, and sales. With cyber liability insurance, you are protected in the event of cyber-attacks like hacking, data theft and destruction, among others.
Management Liability Insurance
Compared with professional indemnity, management liability’s focus is on the people within the company. It protects individual managers, directors, officers, the company employees, or the company itself. The policy pays financial support if you or anyone from the company gets sued due to management breach, health and safety breach, and other workplace errors.
This is referred to as Construction All Risk Insurance, Builders Insurance, and Construction Works Insurance. Construction insurance protects against construction-related injuries damages to the site caused by nature and other unforeseen disasters. It also covers damage to the equipment and project, resulting in loss of profits.
By law, all businesses must comply with some form of compulsory insurance, such as Worker’s Compensation, Public Liability, or Third Party Personal Injury.
Find the Best Business Insurance Partner
Depending on the kind of business you are engaged in, you will surely benefit from having some form of cover. The first thing you must do is identify what particular risks your business may be prone to. Does it run a high risk of theft due to valuable items? What about work-related injuries?
Once you know what kind of policy will provide the best protection for your business, you should study what each one offers. Figure out the things that are covered and not covered by each policy. Take note that risks like economic recession or a business competitor penetrating your market causing financial setbacks are not covered by this insurance.
Once you have picked the best contenders, make it a point to compare each one. You may also ask for advice from a financial advisor or help from an insurance broker. For more help, you may contact Makes Cents and we will gladly assist you with your queries.