Every business regardless of its size and age faces a wide range of risks on a daily basis. Insurance is therefore an essential and it’s the responsibility of every owner to make sure they are prepared for the worst. Generally, business insurance compensates the business in case of an accident. This allows the owner to handle large unexpected expenses with minimal or, in some cases, no actual effect on their balance sheet. If an accident happens and a business is uninsured, it can be devastating, even forcing closure. It is therefore important to always ensure that your business insurance is always paid in time to avoid such an instance.
There are different types of business insurance that are available. The type that is most suitable for your business will depend on the kind of enterprise you are running. Some of the main types include;
Property Insurance Cover
This type of insurance policy covers property owned by the business against risks such as natural disasters, fire and some include vandalism and civil disobedience. This policy can either cover all kinds of risks that may occur, or it could be peril specific whereby it specifies the type of risks that the business owner can receive compensation for. An all risk cover is better compared to danger specific cover in that no matter what risk is involved, you will have your compensation.
General Liability Insurance Cover
This covers damage or loss of general property of your business. Such damages usually have the potential to bring your business to a standstill. Having a general liability policy ensures that your operations run normally even if your product is lost or damage through no fault of your own. This insurance covers you, your business and employees against any known and unknown risks that might occur. However, it doesn’t cover employee injuries and you are required to have an employee compensation cover.
Professional Liability Insurance
This covers the business against malpractice, negligence and errors that might occur when serving your customers. Considering the high cost of lawsuits today, it is strongly recommended for businesses to have this cover. This is especially necessary for anyone in the medical industry or other lawsuit-sensitive sectors. Accidents happen even to the best of businesses, but if you are sued it will be easier for you to pay for the damages if you are insured. In addition, the policy also covers your license to continue practicing.
Product Liability Insurance
This type of insurance is suitable for companies that are involved in manufacturing and distribution of products both on wholesale and retail platforms. Cost and levels of protection will vary depending on volume. The value of products also determines the price of insurance; for instance, an electronics manufacturer will pay more than a clothing manufacturer when it comes to insurance. This cover can also protect the business owner in case a third party is injured while on their business premises or harmed by a product you sold to them. Its only major disadvantage is that chances of such dangers ever happening are very minimal for most companies.
You should talk to a financial adviser and make sure your business is adequately insured for the major risks it faces. Most insurance plans are annual and you should make sure you renew on time to prevent any lapse in coverage.