Over the life of a business, the odds are high that it’ll experience at least one major insurable loss. In the best scenario, an uninsured loss might hobble your business in the short run. In the worst scenario, an uninsured loss could wipe out the business. Let’s look at two notable reasons why business insurance is important and also what types of policies are available.
Many businesses own valuable items. Natural disasters and other events can damage equipment. Theft is common even in non-retail settings. Likewise, vandalism can damage your business assets.
Also, the potential for a company to lose operating time represents an opportunity cost. If a fire knocks out a manufacturer’s main assembly line, the business interruption may be financially worse than the lost equipment and physical plant.
Businesses have liability exposure on many fronts. Stores can face lawsuits arising from customers’ on-site injuries. Manufacturers may face product liability claims. Businesses that transact credit card numbers and other sensitive information have cyber liability exposure. Even the professional quality of your work is a source of possible liability.
Types of Commercial Insurance Policies
Fortunately, a commercial insurance agency can point you to many types of policies. These include:
- Premises liability. This is insurance that protects your business against third-party claims involving accidents on the premises. If there’s a risk that a customer might have a slip-and-fall accident, this would be the appropriate policy. It also protects against incidents involving delivery people and other outside parties.
- Property Insurance. You also need a policy that protects your company’s building and equipment. If a storm, fire or theft leads to a loss, this is the policy that applies.
- Contracts. You also need coverage for contractual obligations. If your firm ends up in breach of a contract, this policy can mitigate a significant portion of the associated financial risk.
- Cyber liability. Many modern businesses handle sensitive information like credit card and Social Security numbers. If a breach happens, the company could have significant legal exposure.
- Legal defense. Even if your company is in the right regarding a claim, the cost of legal defense is considerable. An insurance agent should draft a policy that includes legal defense funding. Otherwise, you could foot a massive bill even if you win.
The range of commercial liability issues is too big to list here. However, the team at Inspiron Insurance Solutions is ready to advise you and set up an appropriate policy for your business. Contact us today to arrange a consultation.