5 Types of Insurance Small Businesses Should Have

October 30, 2017 Emma Miller

There are many new entrepreneurs these days that bring fresh business ideas to the ever-growing market. A lot of entrepreneurs tend to focus on business development so much that they forget or neglect to realize that there are many risks and liabilities involved in running a business. That’s why running a business isn’t just about developing a product and successfully launching your startup on the market. It’s about making sure your business can survive past the launch and remain successful for years to come.

During the development stage, many startup owners tend to focus on getting their business market-ready, while ignoring what they believe are less important details, like insurances. Regardless of your beliefs, the moment you decide to start a business you’re responsible for whatever your business does in the future. If you don’t protect yourself and your business from all the risks involved, you may easily lose everything you’ve managed to build so far. Here are a few types of insurances your small business should have.

Property insurance

Most businesses obtain a property at one point to serve as their business headquarters. If you want to protect your business property from various incidents you should definitely obtain property insurance. This policy covers the damage done to your office space from sources such as fire, lightning and ice, as well as damage caused by theft and vandalism.

The policy also covers the cost of damage done to your inventory, such as computers, furniture and other essentials. Moreover, if your business operations come to a halt because of the damage, this policy can cover your loses and protect your income until the damage is repaired and you’re back in business.

Workers’ compensation insurance

Having employees is vital to business success and you must ensure their safety in order to make sure you can retain them and keep them happy. Workers’ compensation insurance protects your employees if they get injured while working, regardless of who’s to blame for the incident. This insurance policy covers all medical bills and lost salaries while the employee is unable to go back to work. In return, employees forfeit their right to sue the employer in case of an accident.

Furthermore, in case an employee dies on the job, the policy pays compensation to the employee’s family. As a business owner, it’s always a good idea to have this insurance policy, because it not only protects your employees, but it also protects you from liability and legal issues.

Types of Insurance for Small Businesses

Liability insurance

Every business that offers products or services can easily have claims made against them. For instance, if your workers, products or services caused or supposedly caused an injury or property damage to consumers, they can make claims against your business and sue you as the owner. Companies, such as Youi NZ can offer you general liability insurance, which covers the expenses for damage done and protects you from false claims made against you.

Furthermore, if your business offers extra services, such as professional advice, recommendations, product designs and so on, you may want to obtain a Professional Liability insurance policy also known as Error and Omissions (E&O). This policy protects you from legal claims for flawed advice, incorrect recommendations etc. that are made against you and pays for legal expenses.

Commercial auto insurance

If you employ vehicles in your daily business operations, you should make an effort to insure them. Whether you use company vehicles for logistics, such as trucks to transport your products from warehouses, or your employees use their own cars to drive to work, you need commercial auto insurance.

This policy insures vehicles from damage caused by accidents or collisions. In addition, your commercial auto insurance policy can be customized to even replace vehicles that were damaged beyond repair in an accident.

Data breach insurance

Most businesses nowadays utilize the latest technology to improve their work efficiency and operate in the digital world. Also, your business stores sensitive information about business operations, customer and employee information in digital format on company computers, and you’re legally responsible to safeguard that information.

However, the Internet is a dangerous place and many hackers tend to breach security and steal sensitive data from businesses. That’s why you need a data breach insurance policy, because it protects you from legal liability and loss in case sensitive information has been lost electronically or if it’s leaked via paper files.

Insurance policies help protect you and your business from many risks and liabilities that are common in the business world. If you don’t protect yourself and your assets early one, you are exposing your business to failure.

, , ,

Emma Miller

Emma Miller is a Sydney based writer with a degree in marketing. Interested in digital marketing, social media, start-ups and latest trends. She's a contributor at BizzMark Blog.