Starting your own business is exciting. It can also be trying. In the early stages of business, one of the most common mistakes is not buying sufficient business insurance coverage.
It’s an easy mistake to make. Money is often tight early on. This can lead to cutting corners wherever you can. However, business insurance is one place where you don’t want to skimp. Having the right business insurance is essential to your success.
Why You Need Business Insurance
In the early stages of business, you have a lot on your mind. You’re focused on growing your business and generating revenue. It can be tempting to let getting proper business insurance take a backseat while you focus elsewhere. Unfortunately, it doesn’t take much to destroy everything you’ve worked hard to build.
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Business insurance provides you with coverage in the event that customers are injured by your products or services. It covers you if customers get injured in your store or an employee is injured on the job. You’ll need it if an employee is negligent. You’ll be glad you have it if a customer or employee wants to sue and you can’t afford an attorney. Business insurance is also crucial in the event that your business equipment becomes damaged. With business insurance, you can rest easy. That’s because you’ll know that you are covered in circumstances such as these.
General liability is critical for every business. It provides you and your employees with protection in the event of claims of property damages and personal injury. For instance, if someone comes into your business and slips, general liability protects you should they decide to sue. It also provides protection should someone claim copyright infringement. The policy pays attorney fees, investigation costs, and medical expenses. It also pays any awards if you should lose a court case.
If you are providing professional services, professional liability is a must. For instance, let’s say you contracted out employees to do an installation job for an office. However, the installation was faulty and the office owner decided to sue you. In that situation, your professional liability insurance would protect you. This type of insurance would also apply if you provided bad advice that resulted in injury to your client.
If your business sells products, you should invest in product liability insurance. This type of insurance provides you with protection should one of your customers suffer an injury as a result of that product and they decide to sue.
Workers’ compensation is required by law in all 50 states. This coverage, designed to protect employees in the event of injury, consists of two parts. The first part covers medical expenses and lost wages. The second part provides protection for you and your business should the spouse or children of the employee decide to sue. A third part, which is optional, provides protection against lawsuits that might arise from claims of sexual assault, harassment, discrimination, and other similar matters.
No matter the size of your business, if you need equipment to run your business, you need business property insurance. That’s because general liability insurance won’t cover damages to your equipment. However, business property insurance does protect your equipment. It also protects your inventory and your building in case of fire, flood, or storm.
Speaking of disasters like fires, floods, and storms, such calamities can result in loss of business. Your business property insurance may cover you for property damage, but it won’t do anything for loss of business. This is where business interruption insurance comes in. This type of insurance covers the costs of your overhead and other expenses while you are recovering from a disaster.
Should your business require you to provide your employees with the use of company cars, you need to have business auto insurance. This type of insurance will protect them, and you, in the case of an accident. It also provides protection for anyone else who is injured as a result of that accident. As the name indicates, it also covers the vehicles.
In order to start your business, you might require a loan. In such a situation, many banks require that you have a life insurance policy before they will approve a loan for you. That’s because a life insurance policy can cover the cost of the loan in the event of your death. At the same time, life insurance also provides financial protection for your family, preventing creditors from taking everything and leaving them with nothing.
Business Insurance Will Give You Peace of Mind
Money can often be tight in the early stages of business. It can therefore be tempting to put off getting the appropriate amount of business insurance coverage in favor of growing your business and generating profits. However, having the right business insurance is key in setting yourself up for success. It protects your business and everything you’ve worked hard to achieve. What’s more, it will also provide protection and peace of mind for you and your family.