Why Business Insurance needs

Business Insurance

A businessman faces multiple risks when running a business; a natural disaster can destroy the property, an employee can cause a suite, an employee may get injured when on duty or charging a contractual breach.

Why Need Business Insurance

There can be many other reasons that need to be taken care of to protect your business. As a businessman, you need to be careful about both your personal and professional life. That best way that makes you sure about the protection of your business and your life is by purchasing the insurance policy.

Many situations require to get the protection policy for your business, some of them are listed below;

It’s the Law

Small Business Administration requires the Insurance Companies to provide their employees with the different types of insurance policies; worker’s compensation, disability, and unemployment – depending on the business where it is located.

If any business does not get if some policies are legally required that it may face fines, criminal or civil penalties. In severe cases, some businesses may face exclusions from public contracts, as well as the “Cease and Desist” orders – all these scenarios can cause you to pay more money rather than purchasing the insurance policy that is required legally.

You Could Get Sued

It gives a bad image if your business faces a lawsuit or liability claim when you have not purchased the right insurance policy. Without the right insurance policy, your business can face a loss. If a single bad incident, one broken contract, one unpleased employee, one bad decision and your business is over. It has been observed that even some companies win the suit, even they go out of business because of paying heavy defense fees.

Don’t worry about all this, liability insurance can give you peace of mind, that makes you able to concentrate on what matters – running a successful business.

Business Insurance Protect Your Property from Disasters:

Company insurance can protect your workplace from buildings and property. This will protect you from damage caused by fire or flood caused by explosive tubes. In the event of theft, property insurance can also help prevent necessary building repairs and safety upgrades and reduce the cost of replacing stolen units or goods.

Keep Running During the Break:

In addition to the direct costs of repair or replacement, you must also ensure that water damage, fire, or theft will not affect your daily operations. Because every second of your failure is financial frustration, an operating shutdown plan can help you shoulder the burden of operating costs, such as rent and employee salaries, as well as costs. Lost earning. If you suffer significant property damage, you can reduce the transportation cost by repairing official workstations and cutting coverage.

Cover the Cost of Going to Court:

Whether it is a customer who filed a complaint after slipping on the rink outside the store or a customer who claimed that you violated the terms of the contract, he can be sued. May go out of business. Even before the judge announces the ruling, the cost of the trial may prevent you from taking action. There are different types of liability insurance. General liability includes personal injury that occurred immediately, and professional liability includes negligence or error that has caused personal injury or economic loss.

Keeps Your Business Up and Running

For a businessman, it is very important to keep run the business smoothly and effectively without getting in any trouble. Most of the time, even the businesses get destabilized in the case of a one-time disaster like an earthquake or flood. P&C insurance policy can cover the loss in property, for instance, building collapse, machinery, equipment, etc. Even then you have to think about the money you will lose when your business will be closed.

This is where Business Insurance Companies can help you to cover the loss. Upon buying the right insurance policy, it can help you survive a serious disaster to cover the loss you have faced.

When the insurer faces the loss, the insurance companies pay the amount to get your business stable again. Insurance companies also pay for normal operational expenses (like house rent and other utility bills), that often gets difficult to pay in the time of loss.

Most of the insurance companies not only pay you the losses but also offer facilities to pay your employees, for a year almost.  

Makes You Look Credible

The main reason for buying the insurance policy is that it gives an image of a credible business.

The right insurance cover gives a perspective that you, your business, and your customers are in the safe zone. If something bad happens, you have a strong back up in the form of an insurance company. This is why the companies dealing in the service sector label the statement like, licensed, bonded, and insured, on the vehicles and signage. This gives a sense of trust and authenticity.

Protects Your Employees

Not even the product or service you are offering holds the value, the way your employees are, that builds trust and shows commitment to building your brand. Your employees are your most valuable asset and they can build or break your image and it pays to protect them in an event of a loss.

Small business administration requires the businesses to carry worker’s compensation, also you should be taken into consideration the disability coverage, even if you ask your employees to cut a small portion of their salary.

Moreover, considering the employees’ interest as their own is a good gesture and it keeps your business protected against lawsuits or liability claims.

Covers Acts of God

Talking about the insurance language, an “Act of God” is a happening or an event where there is not the role of human hands. There are two types of property or casualty insurance policies;

  • All risk
  • Peril specific

All-risk policy cover protects except for those specifically mentioned, while the peril-specific offer protection for particular risks and cover flood, fire, hailing, snow, and other specific acts of God.

Frequently Ask Questions 

Topic Questions insurance, Which insurance policies protect against the coronavirus (COVID-19)?
Can Progressive help me get insurance in my state?
Do I need insurance if I’m a sole proprietor?
Liability insurance What is the difference between general liability and professional liability insurance?
Casualty insurance, How long do you think the hard market for property/casualty insurance will last?

Statistics

  • US. commercial insurance prices increased 18% in the third quarter, driven mainly by higher rates for property exposures and financial and professional lines, according to a report released by Marsh LLC Thursday. (Source: businessinsurance.com)
  • With the presidential elections the topic du jour, 83% of American workers have political conversations at work, according to the career blog Zety (Source: businessinsurance.com)

Guest Author: Jawwad Hassan