Types of Insurance Every Business Owner Requires

Every business owners know that he or she will never succeed unless they take risks. These risks are calculated ones but nevertheless, it’s important to have an economic safety mechanism. There are numerous types of insurance available for entrepreneurs but it’s up to you to decide which insurance your firm needs.

Property insurance

Although more and more businesses are migrating online, companies still need office space, storage space, or workshops. However, these structures can be vandalized or they can go up in flames, so they have to be ensured. Business property insurance usually covers all sorts of danger, such as floods and theft.

The insurance money you get will be used for repairing or rebuilding the damaged structure. Mind you, property insurance doesn’t cover any damage that cars or bicycles sustain. However, property insurance comes with a “business interruption” clause that covers losses due to the damage your property suffers.

General liability

The broadest type of insurance a business owner can take is general liability. Essentially, any harm that someone or something suffers due to your business operations is covered by this policy. These cases include property damage, as well as bodily injury.

General liability is ideal for store owners who want to insure both staff and customers. In case someone slips and falls or a customer’s property gets inadvertently damaged, medical and repair bills are covered by the insurance company.

Data breach liability

Today, cyber-attacks and hacking are just as common as robberies. Luckily, there is data/cyber breach insurance that covers all the damage your business sustains after a coordinated cyber-attack. This will come in handy, as you stand to lose a lot, from customers’ personal data (credit card numbers, SSNs, medical records, etc.) to business plans.

In fact, if you run a company that processes and/or stores user data, a data breach insurance policy should be a real must. If you are unable to retrieve the lost data, you will face lawsuits from disgruntled customs, which ruin your business for good.

Apart from losing millions in settlements, your reputation will be irreparably tarnished.

Professional liability insurance

Business owners who interact directly with customers and clients should have professional liability. Namely, clients can always sue you for various reasons, such as failures to perform, claims of negligence, and improperly providing services (the most common type of lawsuit.)

Depending on your line of work, there are liability insurances custom-tailored for various industries. For instance, there is pet business insurance for professionals in the pet industry, like groomers and veterinary practitioners.

From a cat sitter to a web developer, every entrepreneur can be sued for negligence. Professional liability insurance covers the damages to a large extent, as even an expert makes mistakes that can result in a lawsuit.

Worker compensation

Apart from the business owner, the workers too have to have some sort of insurance. Worker compensation gives injured employees a steady income while they are recovering and the insurance company covers the cost of medical treatment.

Needless to say, the insurance covers only work-related injuries. Once they agree to these terms and benefits, workers legally waive away their right to sue the employer over any work-related injuries. Even if the employer is clearly to blame, worker compensation annuls the possibility to sue the employer.

In most cases, the local or federal authorities require companies to have worker compensation. This type of insurance protects the workers, as it ensures medical treatment. This is especially important in counties that don’t have universal healthcare.

Key-person life insurance

If a company wishes to grow or expand into new markets, its workers will take the brunt of these ambitions. This means that everyone should put in a great effort but only workers are valuable the same. Like on a sports team, there are VIP employees on whom you can take out a life insurance policy.

Losing these individuals to an injury or sickness is out of the question, which is something insurance companies recognize and offer policies accordingly. These workers are often researcher and developer that are behind new products and services.

Since these products and services stand at the center of the company’s unique value proposal, losing these key individuals presents a real disaster. Losing a savvy CEO or other top talents will set the company back unless they have a life policy on these key individuals.

Conclusion

Insurance goes hand in hand with doing business. It takes a lot of boldness to run a company in today’s market, so risk-taking is considered mandatory.

However, this risk can be somewhat controlled if you take out the right insurance policy.

From insuring the company’s property to a life insurance policy in the name of a key company player, business owners can take out several policies at once to protect their assets.

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