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0 Owning a small business is exciting and challenging at the same time. However, it’s not as easy as one may think. Running a business, big or small, requires a lot of responsibilities. In addition, you should prepare the requirements that are needed.
One of the things you shouldn’t forget to accomplish as a small business owner is insurance. Even if you think your business is safe, and doesn’t need financial assistance, you should still avail of business insurance.
If you’re having doubts, the first thing you can do is hire an insurance broker. Meanwhile, here are some of the benefits of having business insurance for small businesses.
1. Protection Against Financial Loss
Financial loss is the biggest enemy of any business. This is usually caused by various things, including natural disasters, lawsuits, accidents, and theft. With the help of business insurance, small businesses can easily recover financially, as long as they have comprehensive coverage.
However, not every business owner can navigate the world of insurance. This is why it’s recommended to hire an insurance broker. They can help find the right insurance provider and coverage based on the needs of a specific business. In addition, since they work independently, you don’t have to worry about them being biased.
2. Improves Business Credibility
Another benefit of having business insurance is that it enhances the credibility of your business. Usually, clients, partners, and investors are looking into the safety of their finances. Unfortunately, if they think you don’t value your business that much, they may not trust you at all. When this happens, your business might get stuck, and won’t be able to achieve your plans.
On the other hand, having business insurance provides a competitive edge that’s inviting to your stakeholders.
3. Protect Employees
Your business will struggle if you don’t have your trusted employees. Fortunately, when you avail of business insurance, you can easily include workers’ compensation coverage. It’s an insurance coverage that provides financial assistance in case an employee encounters accidents or injuries during work hours.
In some areas, the local government requires workers’ compensation coverage for every business, big or small. However, even if your area doesn’t require it, you should still be able to do so. Besides, if your employees can’t work due to an onsite accident, they may sue you, and you’ll lose more money than you can pay for the insurance premiums.
4. Offers Legal Compliance
As mentioned, business insurance is a requirement for businesses in many areas. In terms of coverage, the most common requirements include liability, commercial auto, workers’ compensation, and property insurance.
In some cases, failure to comply with such requirements may result in fines, penalties, and legal issues. At the same time, you might not be able to operate your business legally, since they might not issue business permits.
5. Covers Business Interruption
Another common business insurance coverage is business interruption. It covers the financial needs of a business in case it can’t operate for a few months to a year. The coverage depends on the policy and needs of the business.
For instance, if you own a coffee shop, and it suddenly gets caught on fire, you don’t have a choice but to halt the operations. Fortunately, with business interruption coverage, you can have the financial assistance to continue providing quality coffee and pastries, in the meantime, until you get back to your normal operations.
6. Safeguards Against Lawsuits
The size of a business doesn’t matter when it comes to lawsuits. Even if you’re a small business that has been operating for a few weeks, you can still face a lawsuit. For instance, if a customer slips on the floor, it’s your liability. However, as a small business, you might’ve yet to achieve your ROI, so it can be difficult to cover the medical expenses and other needs of the customer.
When this happens, they may file for a lawsuit, and you’ll need to come up with much more money. Fortunately, having business insurance can help you cover settlements, legal fees, and other required fees when facing lawsuits.
7. Encourages Peace of Mind
Aside from saving your company from possible financial loss, and enhancing credibility, having business insurance also allows you to have peace of mind. If you know your business is financially protected, you’ll worry less about the daily operations, and help you focus on improving the company and achieving plans along the way.
8. Tailored Coverage for Unique Needs
As you know, there’s no such thing as business insurance that fits all, which is great since the policy is tailored to the unique needs of your business. In some cases, business owners opt to avail of the basic coverage, which isn’t recommended since you might just be wasting your money. Additionally, when the time comes that you need to file for claims, you might not get the financial assistance that you need.
Final Thoughts
While availing of business insurance can be another expensive investment, it can assure the stability and safety of your business. By considering these benefits, you can understand more about the importance of having business insurance.
