It seems that no matter what’s out there, someone is offering insurance to make sure that the item or event is covered. In fact, you can purchase bed bug insurance, wedding “change of heart” insurance, athlete loss of value insurance, and even kidnapping insurance. For Family Guy fans, you might be disappointed to know that volcano insurance is not actually available in Rhode Island (but is offered in other places).
Business insurance, on the other hand, seems to be more natural than the others on this list. Starting a small business, whether it’s online or in a typical brick-and-mortar store, is tough and you need protection from any losses or liabilities.
Below, we’re going to run over the basics of business insurance and talk about whether or not you need it.
What is business insurance?
Let’s start off with the basics and talk about business insurance. Essentially, business insurance is an overarching term that refers to types of coverage a business owner can purchase for loss and liability protection.
It can range from worker’s compensation to general liability coverage and deciding which direction to go varies from business to business but every business needs insurance. Without it, you’re not protected from the unexpected.
Even if you’re thinking that “that won’t happen to me”, you might be surprised to learn that almost 50% of businesses will file some sort of insurance over the next decade. Those are scary odds and it’s better to be safe rather than sorry.
What are you protected from?
As we stated before, business insurance is wide and overarching, meant to provide protection to you from many different areas.
The most costly, and obvious, out there is burglary and theft. Even though burglary and theft claims may not be super expensive, it’s worth having that kind of coverage.
Business insurance can protect you from a number of other issues, such as product damage, workplace accidents, fire, customer injuries, water damage, reputational harm and much more.
Reputational harm, despite being the only one on the list that isn’t physical, it’s actually the most costly. This includes things such as slander, libel, and privacy violations. While somewhat rare, the average reputational harm claim is around $50,000.
Are there different types of business insurance?
Yes, there are a few types of business insurance that vary depending on the business.
For example, if you’re self-employed and work in manual labor, you might get general liability insurance. This is the most basic and common form of business insurance and covers injury and property damage.
Workers’ compensation, also known as employer liability insurance, covers you in case an employee gets sick or injured on the job. It’s going to cover the cost of wages, medical bills, rehab bills, and death benefits in some cases.
The last one, professional liability insurance, covers your business in the case of negligence. You may be the best businessman or woman in the world but we all make mistakes from time to time. If a customer is upset and sues your business, this type of insurance is going to cover damages and legal costs with the upcoming legal battle.
What are some of the benefits of having business insurance?
Besides being protected from accidents and unfortunate incidents, there are numerous benefits to having insurance.
One, it makes your business much more trustworthy. Having insurance means that customers and others can trust you and can bring in more business. You can also have peace of mind knowing that your employees are protected in case something were to happen to them on the job.
The majority of states require some kind of business insurance and it’s an easy bureaucratic thing to take care of.
Lastly, it shows your a responsible business owner who’s willing to take care of their business and their employees.
Do you need business insurance?
If you are serious about running a business, either as a self-employed worker or by hiring employees, then having business insurance is the most logical step.
It’s not worth putting yourself or your business in a position of the just to save money on the bottom line. Make sure you find the right kind of business insurance for you and make sure you’re protected from whatever gets thrown your way.