Owning a business is an artful juggle of risks, costs, and investment. If one gets too unwieldy, no matter how good you are at keeping the other responsibilities in the air, your act tumble down. It’s no mistake that 80% of all businesses come crashing to the ground.
As a business owner, you have to manage the risks inherent in the market. To hedge against the inescapable risk, you need to invest in insurance.
But don’t be fooled into buying an unnecessary policy for your firm. These are the 5 types of insurance for businesses that are worthwhile.
- Workers’ Comp.
There’s an innumerable amount of ways that an employee can get hurt on the company’s campus. Even in seemingly safe, cozy jobs, office-workers are a liability. From slipping in the bathroom to falling out of chairs, protect yourself and your budding business.
As soon as you hire your first employee, sign up for workers’ compensation insurance. Better safe than sorry.
- Property Insurance
Unforeseen fires can strike up in an instance; perhaps a faulty plug or a malfunction in the breakroom. Floods can sweep away entire buildings, drowning all of your working capital. Theft is an inevitable consequence of growth, as well.
It’s essential to protect your assets. Depending on your area (socioeconomically or topographically), choose the right protection plan for you.
- Types of Insurance for Businesses that Produce Goods
If you’re a firm that produces goods, rather than services, plan for lawsuits. They’re unavoidable – people are money-chasers. Purchase a policy that insures against product liability.
Even if your manufacturing process is spotless, there’s room for error. Be it in the equipment or a lineman incorrectly fastening together parts. Even if your company prepared a safe, flawless product, people will find a way to hurt themselves with it.
- Cyber Insurance
As businesses progress into online retailing, different avenues of attack become available. A well-trained magician behind the keyboard can take down an entire company in an afternoon. Having proper cyber defense is a start, but nothing is impenetrable.
Purchase insurance that can protect against data breach liabilities. Data at this age is more precious than gold. It’s always at risk.
- Umbrella Insurance
It’s a good idea to have a catch-all in place. Umbrella policies will insure for risks that were not foreseen. If you weren’t covered for theft, and your building was broken into, this insurance will likely catch it.
But, buyer beware. Uncertainty in insurance comes at a hefty price. We’d only recommend this option if you’re very risk-averse and within a low potential risk bracket (safe area, smaller business, etc.).
If you’re on a budget, we recommend getting captive insurance. There’s less bureaucratic hoopla to jump through.
Aren’t You Glad You Were Covered?
Owning a business is the American Dream. But it can quickly become a nightmare if you’re not insured. There a few different types of insurance for businesses that we recommend.
A business should cover all of its fronts, but do so reasonably. We advise getting insurance that’ll protect against cyber theft and lawsuit liability.
Are you a new business owner and looking to expand your business know-how? Check out our other articles.