Even when money is scarce or revenues are down, businesses should never neglect their insurance needs. Businesses that are not insured or without adequate coverage are taking needless risks, that may eventually lead to serious financial issues like bankruptcy. During a crisis, a business that is underinsured is on the way to its destruction.
Business Property Insurance
Property insurance includes a broad form of coverage meant to protect you from different losses. Your business property insurance should include the following:
- Buildings
- Business property like chairs, equipment, desks and etc.
- Earthquakes
- Loss of income
- Flood
An all risk policy may be structured to cover all of your business equipment like computer software and hardware. An efficiently written policy includes loss of income that can result from breakdowns and hazards that may temporarily shut down your business.
Liability Insurance Coverage
The Comprehensive General Liability policy is especially designed to provide third party coverage for the following:
- Fire legal liability. This protects you from negligence resulting in damage to your landlord’s property.
- Personal & advertising injury
- Medical expense or payments
- Products & completed operations
- General liability for premises
- Damage control plans
Worker’s Compensation Insurance
If your company has employees, this insurance policy is mandatory. Startup operations may find that State Compensation Fund fit for your business needs. As your company grows, you can shop for better prices from various insurance firms. There are worker’s compensation plans that include risk management & loss control services that could be beneficial for your operations. Don’t confuse risk management with you taking part of the risk. Your insurance firm should be able to assume 100% if the employee’s compensation insurance risks.
Other Business Insurance Policies
There are auto coverage insurance policies available for company vehicles. You may also avail of health insurance plans that are tailored to your business needs.
Excess Liability Coverage
Excess liability coverage may be accomplished in 2 methods, namely:
- Excess limits may be added at extra cost to package policies in chunks of $1 million dollar layers.
- A commercial umbrella offers extra insurance coverage over and above your underlying package policy, such as business auto, worker’s compensation and business policy.
Your company of choice may offer lower limits which look attractive looking at a premium standpoint. But most savvy entrepreneurs contemplate on the liability limits of at least a million dollars. The additional cost may be affordable and makes good sense.
Employment Practices Liability Coverage
With premiums exceeding $2,000 yearly for $1 million coverage, Employment Practices Liability insurances are slowly gaining popularity these days. While employment practice liabilities are not often seen in small companies, the threat of sexual harassment or wrongful termination lawsuits become more common as your firm grows.
Life Insurance
If you have a business partner, the buy-sell agreement may be funded by a life insurance in the event of your partner’s death. As the firm grows, this insurance may be increased as well.
Business owners should be aware on the coverage of their insurance policies. A regular review of your plan is a necessity, along with adjustments and updates in insurance coverage as your company needs change.
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