Many
small businesses start in homes, garages, basements, and sheds. As
the business grows, it takes on more risks and requires greater
protection. You should consider business insurance a necessity from
the very start. However, not all small businesses have the same risks
or need the same type of protection. Here are some considerations on
where to start with insuring your small business.
1.
Understand What You Have to Lose
A
lot of math and equations can govern a professional risk assessment.
You don't have to crunch too many numbers at first. Instead, just
consider what you have to lose. All business comes with risks. Your
small business will have risk factors you need to note. A good way to
start assessing your risk is to look at the different types of risk
associated with any business:
- Operational risks
- Financial risks
- Marketing risks
- Economic risks
- Legal risks
Many
other types of risks exist as well. Identifying the risks associated
with your small business operation will give you a better
understanding of what type of insurance you need to consider. As your
business grows, you can consider a more robust, professional risk
assessment to fine-tune your insurance options further.
2.
Consider What You Need to Cover
Once
you know your risks, you can start to think about what specific
things you need insurance coverage for. In almost all cases, you will
need property insurance and liability insurance. You may also need
other types of insurance, but property and liability are two good
places to start.
Property
Insurance
Your
small business includes physical items. These items, or assets, are
integral to the running of your business.
Ask
yourself what would happen if you lost the use of any structure or
piece of equipment. Would your business suffer? If yes, then you
should consider insuring those pieces of property your business
relies on. One stolen or damaged asset can cost you and your small
business everything.
Liability
Insurance
By
conducting any sort of business, you create liability. You need to
protect your business and yourself from liability claims.
Do
you know what happens if someone says your product brought them harm,
or if someone trips and falls where you conduct business? You or your
business will often have to pay for whatever kind of legal process
arises from these types of situations.
One
lawsuit from one person can end a business. For these and more
reasons, you need liability protection.
3.
Research the Different Types of Business Insurance
Various
types of business insurance exist. Depending on the nature of your
small business, you may need specific types of coverage not included
in traditional business insurance packages. Since you now
know your risks and what you need to cover, you can start looking at
what these packages have to offer.
The
typical business owner's policy (BOP) will include some property,
liability, and other types of coverage. These policies aren't the
same across all insurance companies, but a BOP is great for a new
small business as it covers the basics.
Your
business may need other types of coverage, such as cyber liability or
workers’ compensation if you have employees. If you use a vehicle
with your small business, then you need to consider that for
insurance. Basic automobile insurance isn't suitable for business
operations. If you have a home-based business, you shouldn't assume
your homeowners insurance will cover anything with your business
operations.
All
these things are further considerations for insuring your small
business. At Harr & Associates Insurance, Inc, we have coverage
options for every type of business and can customize your plan to fit
your specific business needs. Contact us today to learn more or to
get a quote for your small
business insurance.
