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Business Insurance is Not an Option - It is a NecessityA woman walks into the restaurant you own, and is tripped up by a nail sticking out of the floorboards. She seems fine, but a week later she is back with an attorney and a neck brace. Apparently she hit her head in that fall, and isn't doing so well. Or perhaps you are a mechanic and a customer wandered into your shop and cut his leg. Perhaps you own a pet store and a little girl got a nasty bite from sticking her fingers in the mouse cage. Whatever your business, liability is just a part of the cost of doing business. It is almost impossible to run a business without liability insurance, and in many places it is a legal necessity as well. Business insurance covers liability cases so that a risk you cannot afford (like paying someone else's medical bills) is replaced by one that you can afford (such as a monthly premium). Other types of liability include fire legal liability, which means that you are the liable party in the case of a fire. If you forget to turn of a space heater before you head home for the night and this results in damage to your landlord's property, then you are liable and the damages are covered by the fire legal liability part of your business insurance. Liability is not the only type of insurance to be covered by business insurance. Business insurance can also function like a home owner's insurance policy for the office, protecting the building (if you own it) and the equipment and possessions that are inside. What responsible homeowner does not have his home protected against fire? Shouldn't the same precautions be taken for your business as well? If your business were to be destroyed, a business insurance policy would cover things like desks, chairs, seating in your reception area, computers, equipment, and anything else of value that is a part of your business operation. Business insurance can also provide coverage against things like loss of income, earthquakes, and in some areas even flooding. If a natural disaster takes your business away from you, then your business insurance policy is there like an umbrella, helping to protect you and your family from the losses and breaking your fall, so to speak. Your business insurance policy is there to help you rebuild and go on with your life. If you are an employer, you are also required to have worker's compensation insurance. This insurance protects you in the event that one of your employees in injured on the job. Your insurance will pay for treatments for your injured employee. Other insurance might include insurance for your company vehicles in the case of an uninsured or underinsured driver, health insurance for yourself and your employees, and life insurance. Taking good care of your employees and offering benefits to them is a sure way to attract and keep the best employees possible. One little accident could just about destroy a small business unless that business is insured against the disaster. If you could prevent an emergency situation, why wouldn't you? Taking care to make sure that your business is insured properly and thoroughly is only one step toward running a successful business, but it is a vital one. Insurance is not an option, it is a necessity.
By Casey Yew (Insurance-faq.net)
Read Others Related Articles on Renters Insurance Insurance and Risk Management for Small Business Owners
Many small business owners truly believe that when they have a proper and comprehensive insurance program for their business, they will be “fully protected” from financial losses. Setting aside the grey areas on the fine print of most insurance policies, there are many losses that insurance cannot be extended. Some of the such losses that small business suffered after occurrence of accident; are lost of goodwill to customers due to failure to deliver merchandises on time; lost of faith from employees for not providing a conducive working environment, and many more losses which do not have financial impact initially but gradually translate into financially losses. While insurance is important in indemnifying small business owners in case of fire damaging their properties and/or accidents that causing injuries and loss of life thus downtime in productivity, small business owners should practice risk management in order to create a more sustainable business and have a competitive edge over their competitors to minimize their lost time hence cost. The basic methods of risk management are 1.Avoidance of Risk Simple procedures and things that most small business owners took for granted can have huge impact when they resulted in accident. Always practice the maxim of “prevention is better than cure.” 2.Reduction of risk and losses Be aware of the consequences of risk and accident, develop a loss prevention or reduction system to minimize the occurrence of risk and losses when risk happened. 3.Transferring of Risk Transfer the risk to other parties like insurance company. 4.Keeping of risk and absorption of losses. If transfer of risk is not possible, you may have to absorb some of the risk and/or losses. Some of the insurance policies require the insured to bear a portion of the losses term as deductible or excess. Arranging a comprehensive insurance cover for small business is crucial for the survival, many small businesses have overlooked or ignored the important of a proper coverage for their business, when accident happens, they found themselves in a financial distress and thus loosing their customers to their competitors. It is thus advisable to seek professional advice for a proper insurance coverage and more importantly practice good risk management.
By SK Wong (Clickabiznes.com)
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