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If you start up a business entity, you’ll want to do everything you can to help it succeed. It might be your dream to get this company off the ground, and you might have already invested in it substantially. You want your services and products to catch on, not just because of the personal satisfaction you’ll enjoy, but also because of the financial incentives. Getting the right insurance types for your business is not optional.
If you try to go without them, you’re asking for trouble. Once you have the correct insurance policies in place, you can feel more confident competing within your niche. However, you might not completely understand all of the different insurance varieties in the business world. But, we’ll talk about a few of them right now.
Remember, if you’re unsure whether or not your business needs insurance, you can speak to an insurance broker who’s an expert in these matters.
1. Business Interruption Insurance
The first insurance type we’ll start with is business interruption insurance, which is one not enough people know about. Protecting your business with interruption insurance is one of the best efforts you can make if you’re trying to get a new company off the ground.
Interruption insurance is used if you have to suspend your company’s operation for some reason. The policy might cover several different disruptions, such as fires, various natural disasters, or other events. You’ll have to look at the policy’s fine print to know what’s covered and what is not.
If this policy in place when a disaster occurs, you can use the money the insurance company gives you to keep paying rent on your business’s building. You can also use it to rebuild and make repairs. You could even use it to refurbish your company’s vehicles, continue paying your employees, invest in remote technology, and more.
2. Premises Liability Insurance
Whether you run a brick-and-mortar store or you have an entirely eCommerce business model will matter whether you need premises liability insurance or not. This type of insurance covers you against things like an in-store slip-and-fall.
If someone is coming to your brick-and-mortar location, and they slip on an ice patch in your parking lot, this insurance should cover their hospital bills, prescription medication, and more. It’s far less likely someone will sue your company if you have this insurance variety in place.
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3. Product Liability Insurance
You will also most likely need product liability insurance, especially if you make any type of physical product. When you make your products, they’ll go through an extensive testing battery before you make them available to the general public. Likely you have an R & D department which handles that.
However, you’ll also need to make sure your products get by various regulatory agencies. The specific regulatory agencies will vary depending on what type of product you make.
These safeguards help make sure your products won’t harm anyone by the time they make it to market. However, sometimes, no matter how much you test a product, you find out later that it can harm people. You did your due diligence, but you missed some critical design flaw.
This is where you need product liability insurance. If your product does harm someone, they will probably strongly consider suing you, the manufacturer. If you have this type of insurance in place, it will pay them, and possibly convince them not to pursue a lawsuit if they feel they have received the proper financial compensation.
4. Company Vehicle Insurance
Company vehicle insurance is something not every business needs, but many of them do. Maybe you make a physical product or a whole line of them. You have company trucks that your workers use to transport those products from the factory where you make them, to brick-and-mortar store locations.
It’s also possible that you might drive a company car yourself. You might issue some executives company car privileges to attract them to work for you. In any of these scenarios, you need to insure those vehicles. The vehicle insurance serves a similar function to insurance you’d get for a private car.
However, it’s probably more vital you insure your company vehicles, particularly larger trucks your workers use to transport your products. Since these are much bigger vehicles than most of the others on the road, they can do a lot of damage if they collide with another vehicle, person, or inanimate object. Your company vehicle insurance will help you financially if a collision ever occurs.
5. Professional Liability Insurance
Professional liability insurance is the last one we’ll mention. This is insurance your company has in place that helps cover certain lawsuit varieties. Specifically, you want it if someone brings a lawsuit claiming you made a mistake with a provided service.
Some insurance companies also call this errors and omissions insurance. You might need to use it if you have a customer or client, and your professional service caused them to incur a financial loss.
If your business gave inaccurate advice, this type of insurance can help you. If you misrepresented your company’s services through no fault of your own, it can help you with that, as well. It can also cover you in some negligence situations.
However, professional liability insurance does not cover things like data breaches, work-related illnesses and injuries, or property damage.
If you feel like, based on what you know of your business model, you might need some or all of these insurance types, you should talk to a broker. Brokers know about different niches. They can tell you whether you need some or all of these insurance types. There are also other insurance types they might go over with you.
You’ll be able to focus more on dominating your industry if you know you have the right insurance policies in place to protect you and all your employees.
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