Your business was not built in a day. It was through careful planning, investment, and a lot of effort that you started it, and as your business grows you will accumulate assets that require small business insurance. But are these assets really protected, or are you more vulnerable than you think?
The answer often depends on the type of protection you have. No matter the size of your small business, how much profit you have made, or what industry you are in, you are at risk. It’s important to manage them, but you’ll also need a good safety net if ever a legal, financial or environmental emergency threatens to sideline your business and deplete your resources.
If you know everything there is to know about your small business insurance needs, great! We will prepare a personalized quote for you on the spot . If you’re not sure how best to insure your business, here are five great types of small business insurance that can help you when it matters most.
1. Liability insurance for companies
What is it about? As a small business owner, you can be held liable for damage and injury caused to others (or to the property of others) as a result of your activities. This is called civil liability, and it is not always possible to avoid it: even companies that have done no wrong can find themselves involved in a civil liability lawsuit. Commercial liability insurance (also known as RCE) is very useful when someone is suing your business. This type of insurance is designed to protect you and your business if you are held legally responsible for claims that result from personal injury or property damage caused to a third party by your products or services.
why do you need it? Disasters can occur suddenly and cause serious damage. Whether you run your own candy store or your consulting business takes you all over the place, you need to be financially prepared if things go wrong. After all, no one is immune to accidents or lawsuits, no matter how hard you run your business.
When is this useful? An RCE policy comes in when someone sues you after being injured or damaged in property. If a customer breaks their wrist falling down the icy steps in front of your business, or one of your employees breaks furniture while providing catering services elsewhere, your business could face high legal fees. The lawsuit is what matters: Whether you admit your business was at fault or not, you will need to settle any lawsuits against your business.
What if you don’t have it? If you take the risk of working without the safety net of RCE insurance, you could run into a host of very expensive catastrophic scenarios. In particular, if a judge holds you legally responsible for bodily injury or property damage caused to others, you may have to bear the costs associated with legal proceedings, in addition to the losses awarded at the end of the lawsuit. Of course, there’s also your reputation at stake: a poorly managed lawsuit could damage your professional reputation and drive your clients away.
2. Product liability insurance
What is it about? Usually, this protection is part of your RCE policy, but it may be relevant to explain its specific nature. It is about your responsibility to customers, suppliers and others with whom you interact in the course of your business activities when your product has caused personal injury or property damage to someone.
When is this useful? If your customers are writhing in pain over a bad batch of cookies or an unfortunate shell on a pile of posters enrages your customer, you may have to pay damages. Moreover, product liability claims affect sales to consumers as well as to businesses. If you sell your product (whether it’s appliances, power tools, or heavy equipment) to other business owners, you run the same risks.
What if you don’t have it? Without product liability insurance, your small business insurance could be seriously flawed. If a problem or a claim is attributed to your product, your bill may be steep: after all, you will have to recall or destroy the rest of the products, then manufacture new ones, not to mention the threat of a major claim. in liability (especially if the product problem affected more than one customer). The coverage provided by product liability insurance does not extend to recall costs, but it can ease the burden of legal fees.
3. Business property insurance
What is it about? As the name implies, business property insurance insures your workplace as well as all kinds of things inside and out. Regardless of the type of business you operate, the nature of your location (whether you own or lease your space) and your assets, such as equipment, inventory, furniture, and electronics, should be protected from damage. fire, flood and property damage.
What if you don’t have it? Property claims easily cost thousands of dollars, even for small businesses. If a flood overwhelms everything from your IT equipment to the floor slats overnight, you could deplete your savings on replacement costs and lose your income due to business disruption. Without financial support, your business would be in serious trouble.
4. Professional liability insurance
What is it about? Also known as technology errors and omissions liability insurance, professional liability insurance is used to protect businesses if a problem with their services results in a lawsuit against them. When you work in the professional service industry, like software development, website design, management consulting, health or beauty, a mistake or omission on the job can have big (and costly) consequences.
why do you need it? There is more and more litigation, as customers have never been more inclined to sue for a problem relating to their transactions. As a professional providing a service, you are subject to certain risks. Already, being aware of it can be stressful. Professional Liability Insurance gives you the peace of mind of knowing that you are protected under a variety of circumstances if you stumble on the job.