You’ve worked hard to establish your small business, so you want to ensure it thrives. Part of that involves making smart decisions about the various types of insurance that might be useful to your company.
If you own or manage a small business, you know that failure to plan for unfortunate events can have catastrophic consequences. In the case of your business, those consequences could be financial ruin. That’s why it’s essential that you understand the risks your business faces and take steps to protect yourself from potentially disastrous events, such as having to shut down temporarily if an employee contracts an illness, contracting a disease yourself, or suffering an extreme personal injury at work.
Read on to learn more about what kinds of insurance are available from Cerity and how they can benefit you as an entrepreneur.
Know Your Risk Profile
Knowing your risk profile can tailor your insurance strategy to meet your specific needs. If you operate a retail store, for example, you should know if your products are prone to theft, if your location is prone to natural disasters, and if your clientele is prone to accidents (from tripping over merchandise to contracting contagious illnesses from handling used products).
You should also be aware of local or state regulations affecting your business. For example, if you operate a food truck, you might be required to have a certain amount of liability insurance.
Get a Good Understanding of Your Company’s Needs
Knowing your business’s needs will help you gauge how much insurance coverage you need.
For example, if you suffer a major accident resulting in a large number of lawsuits, you’ll need enough liability coverage to pay those claims. If your company is based in a high-risk area, you may need additional flood or earthquake insurance coverage. If you create or sell products, you’ll need to decide how much insurance you need to cover the costs of replacing faulty or broken merchandise.
You’ll also want to make sure you have enough business interruption insurance to cover the costs that may come from being forced to temporarily close your doors due to an unexpected event, such as fire or infectious disease contracted by an employee.
Know Which Types of Insurance Are Out There and How Much They Cost
When comparing insurance companies and rates, remember that you get what you pay for. Insurance companies typically break coverage into three categories: Property insurance, liability insurance, and workers’ compensation.
Property insurance covers damages to your building and its contents. If your building is damaged due to a natural disaster or fire, your property insurance will pay to repair or replace it.
Liability insurance covers the cost of defending and paying claims against your business for damages or injuries caused by your products or employees. It also covers the cost of lawsuits against your business for monetary losses resulting from faulty advice or service.
Workers’ compensation insurance pays you and your employees if you suffer a work-related injury or illness, including long-term disability. It also covers the costs of hiring and training a new employee to replace an injured worker.
Ask Around and Do Your Own Research
Once you’ve decided on the types of insurance you need, contact a few insurance agents to get an idea of what they’re charging for those policies. Then visit the websites of the insurance companies you’re considering to get a better idea of what your coverage would actually look like.
Once you’ve narrowed down your options, ask each agent to send you a custom quote based on your provided information. And while you’re at it, inquire about any discounts they may offer.
Summing It Up
Insurance is a smart investment for small business owners, and it can help protect you from unexpected events that could financially cripple your company. Considering the tips listed above, you can make better decisions about which types of insurance from Cerity are right for you.