Why Should I Insure my Business?

As a new small business owner you may be somewhat overwhelmed by the amount of expenses involved in the daily operation of your company. Business liability insurance can be frustrating to think of paying for, especially as it is one expense that may wind up going towards things that never happen. If you have been in business for some time and you are in need of additional insurance, the same thought might occur to you. Yet, you know that it is too risky to conduct business just for making a profit without liability insurance.

Business Insurance May be required

Your company may not have the option of choosing liability insurance. This is because many of the local laws and regulations pertaining to your particular industry require some forms of coverage. Usually, a general liability insurance policy will consist of three basic forms of coverage, some of which your company cannot operate legitimately without.

The three forms of coverage are worker's compensation coverage, coverage against property damage and injuries, and liability coverage which protects your company in the event of being sued. It may not be absolutely necessary to carry worker's compensation coverage if your company only has two employees, no matter what local laws dictate. However, there may be reasons why you would still wish to retain insurance of this kind.

You need to verify with your insurance agent or broker as to exactly what forms of coverage are required for your company to maintain. But, even if, as in the case of only having a certain number of employees, you do not need to legally have the coverage in question, think of what stands to happen if your company goes largely uninsured. No one can predict any type of accident whether it is to your company's building, storefront or office.

But, if an accident occurred on your business premises and it injured some of your workers and customers, you do not expect everyone to simply walk away agreeing to pay for their own medical bills and treatments. While some businesses do face unfounded or frivolous lawsuits, in the event of a real accident your company would be liable. It could be that there was something as simple as a wet floor which caused a customer to slip, fall and injure themselves seriously enough to warrant a hospital stay.

That in turn could lead to the person's family seeking restitution to make up for hospital bills, lost wages, and more. The first place they would turn would be to the owner of the business where the accident happened. Even if your company was not truly at fault could you afford to fight a lawsuit they file which is unfounded? Could your business afford the time to fight it?

You probably do not have unlimited funds sitting in an account for just such an accident or lawsuit. But, even if you did have some type of reserve account, there is never any way to predict just how much a lawsuit or accident can truly wind up costing. The cost of proper business liability coverage is an investment that protects your company from being put in a financial predicament that could close your company down.

Comparing Policies and Coverage to Suit your Budget

It is your responsibility to operate a business in the safest manner possible for the well being of your employees as well as your customers and clients. This is one reason you should insure businesses. However, by researching the types of coverage and limits best for you, insurance can cost a lot less than you might think and it can fit within your business's budget.

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