Small Business Insurance Coverage
It is one of those things that can often get overlooked in the general air of enthusiasm for setting up a new business. Insurance is something that is needed when things go wrong; but, of course, nothing is going to go wrong in those first few months and years of a new enterprise. Or is it? Small business insurance coverage is, on the contrary, one of those things that can make or break an aspiring new venture.
Studies by the Federation of Small Businesses suggest that nearly 60% of all small businesses fall prey to crime of some sort or another each year. Crime takes money to put right, of course – whether it is replacing stolen equipment or merchandise or refurbishing vandalised premises. That unexpected expenditure, furthermore, will eat into the fragile profits and, in quite possibly no time at all, turn a successful business into a failed one.
But small business insurance coverage does not stop there. A multitude of other risks also need to be addressed. Practically every enterprise, for example, has dealings with clients or comes into contact one way or another with members of the public. Accidents and mishaps can then leave the business liable for any loss, damage, injury or even death suffered by such third parties. Public liability insurance is designed to indemnify the small business against such claims, ensuring that even the most expensive of them are met from the insurance cover, rather than the business profits.
Insurance coverage for some risks is not merely highly desirable, but actually required by law. If the business employs staff (who are not immediate members of the family) then employers’ liability insurance is a legal necessity to cover the business against claims from employees who are injured at work or who contract illnesses as a result of their employment.
If you are in business as a lawyer, an accountant or an independent financial adviser, then you will also be required to have professional liability insurance to protect your business against claims of negligence or other professional errors. This might also prove valuable security if you are in the business of providing services as a designer, an engineer, architect or other professional consultant.
If you trade in products you have either manufactured or bought in from other suppliers, however, your small business insurance coverage is also likely to include product liability insurance to arm you against claims that the products you have supplied have caused some degree of loss, damage or injury to your clients.
