Managing the insurance needs of a business may not be the most exciting or profitable aspect of running these enterprises, but it can be essential for avoiding unnecessary losses. Insurance is a vital aspect of creating a stable enterprise.
Myth: You Should Wait Until The Business Is Well-Established To Buy Insurance
One faulty assumption about commercial insurance is that it is only necessary for an enterprise that is fairly well-established. While these businesses may have more assets that can be at risk of damage or loss, it is also necessary for startups and new businesses to protect themselves with commercial insurance. In fact, the owners of these businesses may be particularly vulnerable as they can be personally liable for damages if the business lacks sufficient coverage.
Myth: General Liability Insurance Is All That You Will Need To Protect Your Business
A general liability insurance policy will be one of the most basic types of protection that you can have for your business. However, this is far from the only type of insurance that an enterprise will require. For example, many businesses will have a legal obligation to carry worker's compensation insurance or product liability protection. In addition to these coverages, businesses can also opt to invest in business interruption coverage, which can provide income if the enterprise must close for an extended period of time due to a covered reason.
Myth: Choosing A High Deductible Policy Is Always The Economical Choice
While the monthly cost of a policy with a high deductible will be lower, you should avoid assuming that this will always make it the more economical choice. For example, high deductibles can make it much more difficult to use the insurance for the smaller claims that you may need to file, such as claims for broken windows. As a result, a high deductible policy can significantly increase your out-of-pocket expenses for the year.
Myth: It Is Always Extremely Costly To Reduce Your Business's Risk Profile
Reducing your business's risk profile is an effective way of protecting it. However, owners and managers will frequently fail to attempt to make these upgrades due to assuming the costs will be too great. In reality, there are many small steps that can be taken that may dramatically improve a business's security and safety. Some of the more cost-effective improvements can be installing upgraded locks or new smoke and carbon monoxide detectors. Additionally, modern security camera systems have experienced a dramatic drop in cost and installation difficulty, which can make them a wise addition to any enterprise.