5 important types of insurance for a business


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Regardless of the size of a business, it will always face risks such as lawsuits, natural disasters, property damage and cyber attacks, which can put its finances at risk. To give you an idea, an average American business runs multiple lawsuits at once, some of which cost up to billions of dollars, as reported in the Insurance Journal. This means that large companies should also prepare for such risks by purchasing the right business insurance policies. While business insurance does not prevent such risks from occurring, it will put your business in a better financial position to handle the resulting losses. With that in mind, here is an overview of five important types of commercial insurance policies for a business.

Business content insurance

Events such as vandalism, natural disasters, data breaches and fires pose a threat to your business. Losses from such events can be huge or small. While you can cover small losses out of pocket, huge losses could force you to close your trades temporarily or permanently. This is where enterprise content assurance comes in handy. Mark Vanzo of Smart Business Insurance says, “Specifically, it covers your business assets, including equipment, furniture, computers and stationery.” Know that you can dramatically reduce your business content insurance premiums by protecting your premises from disasters and installing anti-theft devices. For example, installing CCTV surveillance and burglar alarms can significantly reduce the risk of theft and vandalism. Also, don’t forget to keep an up-to-date inventory of your business assets in a safe place for the smooth running of the damage insurance settlement process.

Liability insurance

Notwithstanding the security measures in place, your business could be subject to lawsuits for property damage and bodily injury of third parties. For example, if your factory emits harmful gases into the atmosphere causing massive allergic reactions among nearby residents, your business may face several lawsuits. Depending on the extent of the lawsuit, your business finances will be at stake and therefore you should make every effort to protect them. The right liability insurance will cover third party claims, medical costs in the event of hospitalization, funeral costs in the event of death, death benefits and replacement of property by a third party. Keep in mind that proper liability risk management can reduce the chances of your business being sued, even if it won’t offer full immunity, according to the Insurance Information Institute (III) .

Workers’ compensation insurance

Unless your business is located in Texas, you have a mandate to purchase adequate workers’ compensation insurance for your employees, according to the United States Department of Labor (DOL). Indeed, injuries and illnesses occur every year in the workplace, putting employees in poor physical and mental condition. For example, in 2019 alone, there were an estimated 2.8 million non-fatal injuries in the U.S. private sector, as reported by the Bureau of Labor Statistics (BLS). As such, you should be getting compensation for all of your employees, regardless of the nature of the business operations they undertake. In fact, injuries can result from simple accidents such as slipping on wet ground or complex accidents such as being run over by a bulldozer. In the event of such occupational accidents or illnesses, the workplace accident insurance policy will cover medical costs, lost wages, funeral costs and death benefits depending on the severity of the injury.

Commercial auto insurance

According to the National Highway Traffic Safety Administration (NHTSA), at least 6 million traffic accidents occur each year in the United States, of which 6% result in at least one fatality. This shows how risky driving your fleet of vehicles is and why commercial auto insurance is necessary. While training your drivers to drive safely can help mitigate the risk, it will not eliminate car crashes entirely. As such, you need to protect your business finances by having the right auto insurance policies for all of your fleet vehicles. Thus, the insurance company will cover the costs of the damage suffered, including the medical costs of the injured, the costs of repairing vehicles and the costs of civil liability if your professional vehicle hits a pedestrian or hits a building on the edge of the road. road.

Cyber ​​insurance

While small businesses are also at risk of cyber attacks, criminals mainly target large corporations and large corporations, due to the potentially huge profits they generate. Each year, cyber attacks cost the U.S. economy at least $ 100 billion, according to the Homeland Security Digital Library (HSDL). It should be noted that a single cyber attack can bring your business to its knees depending on its cost. With this in mind, you should purchase appropriate cyber liability insurance to protect your business finances in the event of such attacks. This policy covers third party claims, network rebuilding costs, ransoms, data recovery, and legal fees, among other costs. In addition to insuring your business, you should also apply security measures that can protect your business from cyber attacks. They include, among others:

  • Train your employees in the safe use of electronic devices
  • Installing a firewall
  • Use strong passwords and update them regularly
  • Regular update of your software
  • Avoid connecting to your corporate network over public Wi-Fi

Conclusion

To adequately protect your cooperation, you should purchase all major business insurance policies, including cybersecurity, commercial auto insurance, workers compensation, third party liability, and commercial content insurance. To get the right commercial insurance for your business, be sure to consult an insurance professional for proper advice. Since different business insurance policies have different exclusions, be sure to go over the fine print with a fine tooth comb.


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