Business insurance is essential for all companies. If you own or are in charge of a small business, you need to carefully consider acquiring adequate cover. Insurance is a necessary expense, but what should you be covered for, and what else is there to consider bar the obvious? Let us look at five things you need to get right if you want to make sure that your small business is adequately protected.
1: Cover for Liability
This area of insurance protects you and your company against claims made by consumers regarding the products or services that they bought from you. If they are injured while using what you sold them, they might try to sue you. You need to have a policy that covers all legal costs and compensation payouts. As with all areas of insurance, you should talk to a professional who will be able to assess the level and type of cover you need.
According to Fundamental Insurance Brokers, a small business insurance broker in Australia:
“Small businesses need insurance more than any other type of business. Insurance may be the difference between their success and failure. And not any insurance!”
2: Cover for Assets
Once you have discussed the insurance needed for liability issues, you need to think about the assets associated with your company. Many small businesses make the mistake of insuring their premises as their only asset. The buildings must be insured, but do not forget the assets within.
Other assets may include tools, machinery, computers, vehicles, laboratory equipment, medical devices, other equipment of value, and any existing stock. It is important that you have excellent cover for all of your assets.
3: Lost Income and Theft
What about your company’s financial assets? You’ve covered the buildings, contents, and equipment, but what happens if – through no fault of your own, you suffer problems that cause you to endure a loss of income for a certain period? Or, what happens if you are a victim of theft from a break in, or perhaps via someone who works for you? Such things do happen and are troublesome.
You need to talk to an insurance expert in some depth regarding this potential problem, as it is one that requires specialised and carefully thought-out cover.
What would happen if somebody broke in and stole your client list? As far as your competitors are concerned, that list is extremely valuable. It would be financially devastating if they erased all data on client histories, sales, visits, etc. Client lists, proprietary software, and other abstract items, if they are valuable, are also assets; we call them intangible assets or intangibles.
4: Reputable Insurer
The world of insurance exists in a fiercely competitive marketplace. All insurers offer basic levels of cover. Not all of them, however, can provide exactly what your company needs, i.e., a specially tailored policy.
A professional, reputable insurer will first find out exactly what your requirements are. They may also suggest important scenarios or assets that you had not previously thought of. When all your requirements are listed, they will put forward a proposed policy just for you.
To save time and avoid ending up with a policy that might not be the best one for your company, ask the insurer whether they can offer custom-made cover.
5: Sensible Rates
Cost is always an issue for businesses, especially SMEs (Small and Medium-sized Enterprises). We all know we must pay. However, we also want to know whether we have paid too much, the right amount, or even too little. There may be items in a policy that are irrelevant for your company – why should you pay for them?
Your insurance policy needs to have all costs itemised; make sure that they are. Do not hesitate to ask questions about costs. It pays to shop around and get a few quotes.
Small business insurance is essential if you want to operate knowing that you are covered in all essential areas. So, talk to your insurer and explain exactly what you are looking for. Hopefully, after reading this article, you will be in a better position to find the right policy. Good luck!
Interesting related article: “What is Business Liability Insurance?”
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