Business Owners will always be faced with unexpected challenges and a good insurance coverage will keep any business out of trouble. But there are all sorts of insurance policies out there and the extent of the coverage varies on the nature of the company, the size of the property and the industry it belongs to. A basic insurance coverage for small businesses combines a number of coverage options in a single bundle at a cost-effective price, a better deal than getting each of these coverage plans separately, this is called a BOP (business owner’s policy). BOPs include property insurance, business interruption insurance, employee’ compensation and solid liability insurance plus insurance for commercial vehicles if there are any. You need to have this down pat before you start thinking about getting a customized type of insurance.
If you’re still weighing the significant cost of your business’ property insurance, here are 3 big reasons why you shouldn’t hold back on the coverage:
Anyone and anything inside your place of business- your employees and your equipment- should be insured under a liability coverage. In case something unfortunate happens, the liability insurance can protect you from the effects of unforeseen events such as fires, floods and work place accidents. It can also spare you from the huge expense that comes with a lawsuit or liability claim. By having insurance, you can easily rebuild and repair your property. You can keep your business running without a hitch, minimizing risk and prevent further disruption on the delivery of your products and services.
Building insurance coverage are a requirement of the law. Failure to comply legally may be punishable by huge fines and criminal penalties. Though the rules may vary in your location, the last thing any entrepreneur wants is a cease-and-desist order plus possible jail time during a time of crisis. Taking out a policy for your property and your business located on that property costs a considerable amount of money to begin with, some states have minimum coverage requirements for property damage liability, so make sure as a business owner you know how much insurance coverage is required for your area and for the size of the property you own.
Loss of Life
Though this reason is already included under the first one, the liability factor. One cannot stress enough how damaging it would be for company morale to lose an employee. From a moral standpoint, even with enough coverage and a large liability claim after an unfortunate incident, most business owners cannot deal with the psychological impact of a worksite tragedy under their watch. Funds provided by the insurance in case of death or disability can help an employee’s family cope with the loss or the life-altering impact of an accident by covering loss of income and other needs.
The Author is an industry insider on landlord building insurance.