Can I Ensure All of my Businesses Under One Policy?
The cost of operating one business can be high enough, but if you have several businesses, the operating costs are ones you seriously need to keep as affordable as possible. This requires a regular review of the budgets involved in each business. Fees, charges and operating expenses fluctuate with various economic factors influencing your businesses. But, the costs of insuring employees and all of your businesses can be kept largely under control.
After all, you can adjust the coverage limits or deductibles up or down as needed to regulate your overall insurance costs. But, since business liability insurance is often general coverage against risks any business faces, you may wonder if you can get by on one policy only. The answer is probably not.
Why you need more than one Policy
General insurance may suit covering one form of business adequately, but it may not be enough for another. If you own a consulting business and a dry cleaning business, the two types of businesses clearly require vastly different forms of coverage in order to be insured properly. A consulting firm might be fine with a general liability insurance plan.
It may be that the firm could use errors and omissions insurance, as well, but for the most part a general liability plan would suffice. The dry cleaning business would need at least the general form of insurance together with ample coverage for any employees. There is probably a greater risk for employees at the dry cleaning business to become injured on the job since heavy machinery is involved in the work they do.
Because of this, you could not get by on one policy insuring two businesses. Obtaining coverage depends on the type of businesses you need to insure. Not all businesses will qualify for coverage. It depends upon the type of business, or the owner's lack of history owning that kind of company, but sometimes it is possible that a certain company will not qualify for coverage.
If this situation were to apply to you, obviously you would only be able to get coverage on some, if not just one, of your companies. However, keep in mind that for unusual ventures or businesses manufacturing cutting-edge products, you might be able to set up a fund which could be reserved in the event of accidents or lawsuits. This would apply in very rare situations, but setting up your own reserve fund could act as a form of insurance.
For the most part, you want each individual company insured for its specific risks. The degree of risk involved in each company would dictate how much coverage is best to maintain. The greater the risks are in the ordinary course of operating the company each day, the more you would want to carry in terms of coverage limits. One policy would not provide for the specific risks of each individual business.
Keep in mind that paying for insurance on any business venture is usually far less expensive than going without coverage. It is less expensive to carry the proper coverage each company needs by holding one policy on each company, too. You do not want to risk being insured in a general manner for a company that has specific insurance needs.
Reviewing your businesses' budgets regularly is important. This includes conducting yearly reviews of the insurance needs of each company you own. Rather than trying to insure all businesses under one policy, which may not be possible, be safe and insure each individually.
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