Having your own business is not without risks. First of all, you are risking your own, or someone else’s, startup capital. And if the business should go under, much, if not all, of that initial investment would be gone.
But of course, there are also other risks to consider. For example, what would happen if someone tried to sue you and your business? Could you cover the costs for lawyers, court fees, settlements, and judgements?
This is just one of the reasons there lots of types of insurance to consider getting for your business.
1. Property Insurance
Running a business means you have the worry of something happening to products you might sell. But there’s also the possibility of damage to your building from floods, fires, or other calamities. And let’s not forget the business records you keep and the equipment you use frequently.
Damage or loss to these valuable parts of your business could severely hurt your business profits. It could even cause you to close your business permanently.
That’s why business property insurance is something to consider for your business. It can cover both the inside and outside of your business, including the contents. But if you freelance, or do other work from home, some policies will still cover your losses there are well.
2. Professional Liability Insurance
Let’s just say someone really does try to sue your business. The kind of policy you may need to protect it is professional liability insurance, also called errors and omissions.
If the lawsuit is the result of a customer or client who is dissatisfied with your services, having professional liability insurance gives you a measure of protection. It would also kick in if a client thinks you have been negligent in your work for them.
3. General Liability Insurance
A general liability policy is another kind to consider. In the event a customer is injured, this insurance covers their medical costs from the injury.
But that is not all it covers. Many policies also include property damage loss for your clients as well as libel, slander, and copyright infringement.
4. Cyber Security Insurance
Hackers are stealing more than just money from businesses these days. That’s why it pays to think about getting a cyber security policy for your business.
Your business records could include confidential information you don’t want falling into the hands of others. Whether it’s a thief that takes it or it’s simply an accidental disclosure, the risk is real.
A comprehensive policy will assist with prevention of data loss. It may also include education to initiate monitoring as well as lowering the risks of data breaches. Finally, should a loss occur, it will help to cover such losses.
5. Workers Compensation Insurance
Do you have employees who work for you in your business? If so, something to consider for your business is workers compensation insurance.
Not all states require employers to carry workers compensation insurance. And even in a state that does require it, the number of employees you have can also be a factor.
Regardless, if you have any employees, you may need workers compensation to protect both them and your business. That way if the unthinkable happens to one of them, you won’t lose your business trying to cover medical costs, lost wages, and more.
The Bottom Line
The amount each business needs is not set in stone. In addition, you could have insurance needs other than those mentioned. Some include health, life, auto, disability, vision, dental, and many others.
That’s why it’s good to do a business checkup from time to time. It will help you make adjustments to insurance coverages to match business volumes and your company’s worth.
Clearly having insurance won’t keep your business from facing challenges and risks. But these types of insurance could help you keep your business rather than losing it.