With the recent financial crisis climbing, many small enterprises are being forcefully driven out of business. The last thing any small business needs are high insurance premiums; especially recently, when expenditures are low and costs are at an all-time high. In this type of financial climate, it is up to most small businesses to not only find insurance, but to also find the particular kind of plan that is right for them, one that is both cost efficient and that provides a sufficient amount of coverage. Although every business is different, there are still certain insurance packages that most small businesses should consider mandatory:
Property Insurance: which covers the loss or damage of the contents of a businesses workplace.
Liability Insurance: a plan that provides coverage for any legal actions taken against your business that were caused by any negligence from the business or your employees.
Workers Compensation: A system that is mandated by the state, with each individual state having their own plan. In this type of plan, an employee is stripped of their rights to sue their employer for any on-the-job injuries, in exchange for the employers participation in a system that covers any medical bills or damages that an employee would obtain in the workplace.
Although these are the three main insurance plans that every small business should have in place, there are many other types of coverage that each enterprise should buy if they want to have the right amount of small business insurance.
First and foremost is commercial auto insurance. It is a common misconception from many business owners that their personal auto insurance will cover vehicles used by their business, even if they’re using the same vehicle that is covered by their personal auto plan for commercial purposes. What they don’t know is that many personal auto insurance plans will exclude coverage for commercial uses of the vehicle, simply because there is no definition of a vehicle’s commercial uses in a personal insurance plan. Commercial auto insurance will establish these definitions of a vehicles commercial use, and thus provide subsequent coverage for a vehicle that is used on-the-job. In this case it should also be seen as a necessary expenditure for any up-and-coming enterprise that is looking to buy small business insurance.
What’s most tricky about insuring a small enterprise is that every business has it’s own insurance needs. An author would need to carry a policy for libel or plagiarism while a contractor would not find such coverage necessary. The type of plan is subjective to the type of business that is looking for insurance. That is why it’s so important for every business owner that is looking to buy small business insurance to find an insurance broker or agent who they can trust to find the coverage that is right for them. Do they have any essential workers that would require them to buy key employee insurance coverage, or would they opt for business interruption insurance in the case of extreme natural disasters? Only a good broker or agent would know for sure, but it is also important for the business owner to be willing to pay for the coverage that is right for them. Although it may cost more upfront, it is better for the sake of business to purchase a more expensive insurance coverage that will properly cover your business for any damages, than to lose it all in an unexpected accident.