You never know what could happen. Business may be doing great one day and the next, your office has been obliterated by some disturbance – be it natural or man-made. Murray Priestley business acumen suggests to protect your assets, the National Association of Insurance Commissioners recommend these four types of insurance policies that can help your business survive most kinds of disaster.
1. Business Interruption Insurance
If there’s been some interruption to your business due to fire, hail or any other circumstance as stated in your policy, then Business Interruption Insurance will cover any lost earnings. It also covers expenses like your payroll and utility bills, and any other expenses that’s associate with running your business. To determine the amount covered, the insurance company would base it on your business’ financial records. Some policies will even cover the extra expenses as needed to get back on your feet.
However, some coverage may not be payable for a certain number of days so you have to discuss this closely with your agent. Should there be a waiting period, then you have to make sure you have enough funds to tide you over.
2. Property Insurance
Property insurance takes care of you and your business if there’s been theft or damage to your property and equipment. If you are the owner of the address, then this insurance policy will cover the physical structure as well as your assets. Check to see if you are eligible for the Actual Cash Value or replacement cost. If ACV is possible, then you might have to get an update policy if there’s been significant changes to the property or the environment since the last time an appraisal was made.
If you are on lease, then the coverage will be for the contents only.
There are three types of insurance policy that you need to be aware of. These are the Basic, Broad and Special. Speak with a licensed insurance agent to determine which of these three is best for your business situation.
3. Worker’s Compensation Insurance
Sometimes, accidents at the workplace or during the course of the job happen. To protect your business from such claims, you will need Worker’s Compensation Insurance. Such policy will take care of your employees’ medical and rehabilitation costs as well as lost wages.
4. Liability Insurance
This is the insurance policy you need to cover you and your business in the event of: a) bodily injury, b.) damage to others’ property, c.) personal injury, and d.) false or misleading advertising.
Also called the Commercial General Liability, this insurance policy will take care of should you be sued for policy compensatory damages, punitive damages and general damages.
Some of the items for discussion with a licensed professional with regard this policy include: the scope of coverage, availability of extra protection and whether or not the premium will be impacted by the addition or reduction of employees.
Of course, three out of four of these policies may not be applicable if you’re running an online business without an office. But generally, you should have at least one insurance policy to make sure you have a fallback should some things go wrong with your source of income/alternative income.
Like all things business-related, make sure to discuss policy coverage and plans with a licensed adviser.
About the Author
“Murray Priestley has 25 years of commercial and asset management experience having served in board, CEO and senior executive positions with a number of global public and private companies.”