Business insurance is one type of insurance that is often overlooked by companies. Insurance is essentially a way of protection against financial loss incurred due to unforeseen events. In business terms, it is primarily used as a type of risk management, mainly to protect against the possibility of a very unpredictable or contingent financial loss. When an insurer promises to compensate a loss in the event of certain events, the insured business has agreed to purchase insurance from that insurer. Insurance comes in many forms and each form differs from the other in coverage and the exclusions included in the policy. It also differs in premiums and cost structures.
Property Damage, liability, and Professional Liability cover losses sustained at the hands of others, and are the three main components of business insurance. Property damage, which includes storm damage and vandalism, is the most common type of business insurance. This protects against losses arising from property damage or destruction caused by fire, flood, lightning, or explosion. The liability covers claims made against an individual for injuries or damages to his/her property; for example, theft, assault, etc. Professional Liability is used to cover claims for errors and omissions of services, negligence, and professional errors or negligence.
Business owners also need to consider other important types of insurance to help protect their businesses. One type of insurance that is very helpful to small businesses is Insurance Against Fire and Theft. It provides protection against unplanned or unexpected fires and theft, which can be devastating to small businesses especially if they have not invested in insurance before. The amount of protection can help protect the business from a loss suffered because of fire or theft.
There are also various policies that offer property coverage, which provide protection for the business against damage, loss, theft, or interruption of its normal operations because of damage from fire or theft. Property coverage generally requires that the policy limit be paid upfront. Policy limits generally will cover the total cost of repair, including all legal fees, expenses for removing the damaged building, and any damages to personal property. Policy limits can also include other fees associated with your loss, which may include disbursements to vendors, advertising costs, and miscellaneous charges.
Workers’ compensation insurance is another type of insurance you should consider investing in. Workers compensation provides protection for employees who are injured on the job. In some states, there are no legal costs; however, in other states, workers’ compensation insurance can pay for legal costs, medical costs, lost wages, pain and suffering, and other benefits to employees who have been injured on the job. These benefits can help alleviate the financial impact of an injury on the family of the employee as well as the business. To determine the amount of workers compensation insurance you need, consider how much the company’s profits would be expected to be affected if an employee was killed or injured on the job.
Another type of insurance you should consider investing in is personal bodily injury liability insurance. Bodily injury liability insurance provides protection for individuals who are injured while driving or operating a vehicle. This includes any bodily injury, pain and suffering, property damage, and other associated expenses. Depending on your business operations and the number of vehicles you operate, the amount of coverage you purchase can vary. A good bodily injury liability policy will include medical expenses, rehabilitation, and funeral expenses.