As a small to medium-sized business owner, you’re well aware of the many types of liabilities you’re responsible for. However, not all businesses cover all these which can come back to bite them in the long run.
Take how the high cost of healthcare, for example, could affect your revenue. Without the proper insurance, a persistent flu virus that runs through your office could cost you tremendously as the bulk of your workforce has to take sick days and amount staggering medical bills. Those bills will have to be paid from business revenue if you don’t get the proper insurance.
In the following, we’ll take a look at six different types of insurance that you must have as a business. These are just the basics, and you can tailor your particular insurance package to the specifics of your industry.
- Property Insurance
If you’re leasing the office building, you don’t need property insurance. However, if you own it, this type of coverage is essential to protect you from fire, vandalism, theft and other forms of physical damage. Replacing all those computers and hardware in the event of a fire would be otherwise prohibitive without such a policy.
There’s an additional feature of property insurance: loss of earnings. This means that if your business is inoperable, you can extract earnings during a certain time period.
- Commercial Vehicle Insurance
This is especially useful for companies that have fleets – such as limousine and courier services. It is a rangy type of insurance, in that there are separate subdivisions that cover vehicles that transport different kinds of cargo. Even if you don’t have a fleet, non-owned auto liability insurance will cover damages and accidents for employees who drive their own cars for business.
- General Liability Insurance
Liability insurance is a necessity for every type of business. Whether you work from an office or from home. This coverage protects you from physical injuries and property damage that may inhibit your ability to make a living.
Most importantly, it protects third parties that may be harmed while on your premises or while conducting work tied to your business. It extends beyond just physical injuries or property damage. For example, if a guest or an employee plugs their smartphone into an outlet in your office and an electrical short damages the phone, general liability insurance may cover the cost of the damage done.
- Data Breach Insurance
You may recall the giant data breaches that the superstore Target suffered a few years back. When something like this happens, employee information is hacked and released on the webs, and the company is responsible for this. Essentially, when you create a cyber-vault in which employee information is stored, you are compelled by law to protect it. If there’s a data breach, people can sue; this type of insurance will help you cover the damages and costs associated with such lawsuits.
- Life Insurance
This is the most common type of insurance – for obvious reasons. During your life, you pay a monthly amount. This premium means that upon your passing, the amount of money associated with the package gets paid out to whoever you listed as a beneficiary. Although it’s often considered a personal type of insurance, it can also benefit small businesses if structured correctly.
- Business Owner’s Policy
This is one of the most convenient types of packages available for the SMB (small to medium-sized business). It covers a host of necessary areas, including automobile coverage, property insurance, crime insurance, business interruption insurance – in cases of disaster recovery and business continuity – and liability insurance.
You can, of course, buy these separately – but the final price is often reduced in the packaged form. To find the best one for your business, first assess the types of insurance you need before you go hunting for the expansive coverage. This way, you won’t be influenced to get coverage you don’t actually need.