4 Kinds of Business Insurance You Need
Some entrepreneurs focus so much on developing their products and neglect to protect themselves and their business against different risks. This oversight results in major losses when an unforeseen event occurs, resulting in the near-collapse of the business. This article discusses four kinds of insurance that your business needs so that you are protected against risks that can cost you your business.
1. Business Interruption Insurance
You may have a wonderful product that you are selling to an eager market of clients but then an unforeseen event, like a major earthquake strikes and you are forced to keep the doors of your business closed for several weeks or even months. Such an event can cause you massive losses since you will be unable to sell your products and yet you have costs to meet like salaries for your workers.
Business interruption insurance comes in to compensate you for the lost income during such a time so it enables you to live through that difficult time without having to wind up your business.
2. Product Liability Insurance
The rate at which litigation is growing is so alarming that you should never think that your careful attempts to ensure product safety would be sufficient protection for your business. You can be sued at any time because of someone claiming that they were harmed after using your product.
For instance, someone can claim that he or she developed skin cancer after using the cosmetics you make. Such a suit can result in a heavy compensation award that can ruin your business. Product liability insurance protects you against such eventualities since the insurance company would compensate the claimant.
3. Workers' Compensation Insurance
Any business with employees needs workers' compensation insurance. Such insurance covers eventualities like sickness, death or injury while on the job. Getting this policy shields you from draining the finances of your company in case any of the risks referred to happens yet you had not bought the relevant insurance policy (workers' compensation).
4. Property Insurance
Property insurance is important whether your business owns or simply leases the premises from which it operates. That insurance will cover your equipment, inventory and furniture in case a fire breaks out or your property is destroyed during a storm. It is also important that you get a policy to cover the property in the event of a mass-destruction risk like an earthquake or flood. This is because most property insurance policies do not cover that kind of risk.
Even if you are cash-strapped, ensure that you get the four kinds of insurance above so that your business is insulated from those unforeseen events that may wipe it out. Consult with insurance providers like Elders Insurance to learn more.