Only around 50% of businesses [PDF] make it past the 5-year mark. Making a small, regular, and gradual investment into a business insurance policy may have protected them from going out of business. Business insurance exists to keep your savings and profits intact. Small businesses especially can shut down after a single lawsuit, and an appropriate liability insurance policy could be a lifesaver. In the text below, you’ll find relevant, up-to-date information on insurance for business ventures, as well as some additional tips for business owners.
Why You Need Business Insurance
Perhaps you own a construction business, and an employee got injured on the job. Even though you are not directly responsible, you will be held legally accountable. To help bear these costs, you can choose from a wide array of insurance policies. Property and auto insurance protect your assets, and liability insurance pays for damages and legal fees should charges be brought against you. Depending on your industry, you can even purchase professional indemnity insurance covering damages for having given poor or ineffective professional advice.
Like many other business owners, you are likely an expert in your niche but know little about insurance. You needn’t worry – insurance brokers help policyholders mitigate insurance-related obligations. They handle everything from making sure you choose the right policy for your business, to reminding you to update and renew it. The best insurance agencies use insurance SaaS services to anticipate policyholders’ needs. The PathwayPort SaaS solution is one such service. Insurance agencies use Pathway’s email automation solutions to send relevant documents to clients, exactly when they need them - which means that you will always be kept up to date with the most pertinent information which is relevant to you. You will be made aware of all the insurance policies that are available to a business owner. They also provide a web and mobile app that allows policyholders to access their policy information, make payments, chat to your broker and much more - on the go and at all times.
What Does Business Insurance Cover?
Business insurance is a general term that includes several different types of insurance policies and coverage options.
Professional and product liability insurance: You can file a professional insurance claim if you or one of your employees makes a professional mistake. The same goes for causing damage to clients or third parties due to a lack of oversight. If one of your product endangers a clients’ health, you can file a product liability claim with your brokerage. This is highly recommendable for all industries where the mistake or damage can be understood differently, when observed from different perspectives.
Property insurance and vehicle insurance: You can file a property insurance claim if your furniture, equipment, or inventory are damaged or destroyed in case of fire or theft. Keep in mind that high-end items such as art or jewelry require additional coverage. The same goes for particular types of perils, such as floods, sewage backup, and earthquakes. Vehicle insurance covers medical costs and any damages done to the vehicle, as well as to third parties. If you are using a vehicle for business, it would be a good idea to go above state-mandated costs. Additionally, if you are a cab driver or you run a food truck, you should definitely prioritize this form of insurance.
Workers' compensation insurance: You can file a worker’s compensation claim if an employee gets injured or falls ill on the job. This form of insurance covers medical benefits and/or wage replacement. It is of vital importance for your entire insurance process because, once paid, it protects you from civil suits from workers. Therefore, this coverage is highly recommended for construction companies, mechanical engineering companies, or any type of business where employees are in touch with heavy machines.
Business interruption insurance: You can file a business interruption claim if a disaster, such as a fire, causes your business to lose income. You would also be covered if a nearby object was hit by a disastrous event, and the government closed the surrounding businesses. Businesses such as restaurants and clothing stores need business interruption insurance because they require a brick and mortar facility to operate. All businesses that are offering services, therefore that depends on contact with their customers - should consider purchasing this type of insurance.
As a business owner, you have a wide range of responsibilities, to yourself, your clients, as well as your employees. Keep in mind that mistakes happen all the time and you can’t be prepared for everything. But it is your job to prepare for the eventuality of property damage, legal liability, and worker-related risks. A solid business insurance plan, however, is about more than merely assuming responsibility for others. It is the way business owners can safeguard their dreams and invest in their future. Better safe than sorry.