Running a business is all fun and games until we unexpectedly encounter incidents that could jeopardize the vulnerable state of the business, leading to unfortunate circumstances. Your business is potentially prone and exposed to risks such as financial losses, suits filed against the company by third parties or clients, natural disasters, law breaches, and other hazards that could be harmful to your business’s prosperity in the long-run.
All these factors indicate clear reasoning as to why business insurance is necessary to protect your company’s profile. To protect your company from any serious, sinister sabotage and damage to its operations and credibility that could lead to income loss and ultimately shut down your business, effective insurance plans are needed to safeguard your business from unendurable mishaps.
An insured company could result in an increase in the credibility of the business from a client’s and customer’s perspective, the ensured protection of investments could incline and lure in more investors that could lead to exponential growth for the company. This is, especially if the company has an edge as opposed to competitors that remain uninsured and continue operating. It is always a safe option to have your business insured, the benefits attached to it that outgrow the risks can be significantly and factually proven as below.
SAFEGUARDS HUMAN ASSETS
In the unfortunate circumstance of an owner facing bodily injuries, heart attacks, or any serious accidents that may cease business operations for prolonged period insurance can be of quite use. Business-owned life/liability insurance offers financial support in a way that will provide for payments to cope with the loss of income your business would normally generate if it were to operate.
It also offers ‘key person’ insurance to cover the loss of a potent member of your business as well as the owner’s family health coverage. In case of a loss of your own life, it also provides monetary assistance for the purchase of an interest in compliance with a buy-sell agreement.
IT’S A LEGAL REQUIREMENT
Even if you might find it to be unnecessary, there is no way you could escape the law. The Small Business Administration (SBA) states that a business that has employees must provide for them in a way by ensuring them with workers’ compensation, disability concerning unemployment; these tend to differ depending on where your business is located and as per your country’s policies.
If you are found guilty of breaching the law, your company could face a heavy fine, criminal penalties, or even going as far as you receive a ‘cease and desist’ order that could put a halt to your business operations. All this could cost you a lot more than the price of the insurance that you may overlook.
YOUR BUSINESS CONTINUES TO RUN
In case your business encounters devastating, tragic events similar to those of natural calamities, floods, and earthquakes, for instance. You do not have to worry if your business is insured with property and casualty insurance that covers the loss of your assets, including buildings, equipment, and property.
In case you are wondering about the loss of income your business would generally generate during this time, similar insurance referred to as business owners insurance (BOP) comes in handy. This insurance could help prevent your business from undergoing a loss in income due to serious catastrophic disasters. You could even opt for employee wage protection lasting up to a year.
INCREASED CREDIBILITY
Possibly the biggest and most evident advantage that would contribute to the wellbeing and overall image of your business would be the reliance on prospective clients, investors, and customers would have for your company. The reliability comes from them knowing you would be able to compensate for any mishaps incurred for the work you must do for them, therefore gives them a safe bet to trust and invest in your business. Most businesses even like to publicize their ‘insurance’ factor mainly to attract more clients.
EMPLOYEE PROTECTION
Just as the law states, your top-most priority would not be to improve the quality of products you are offering or worry about the wellbeing and maintenance of your equipment or even the goodwill attached to your brand image. Your biggest concern as a responsible owner would be to cater to any of the slightest mishaps that your employees might face as human labor is your biggest asset.
It is better even to offer your workers with disability coverage regardless of whether or not you charge them for a fraction of that cost. Employee protection comes with internal business interests that could save you against liability claims or even lawsuits.
THE FINAL WORD
You can never predict what the future holds. We can learn from the current situation of the global pandemic ruling in 2020 that has surely affected several businesses that were uninsured. Business insurance could offer you smooth operations for your company and your peace of mind.
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Interesting related article: “What is Insurance?”