Small businesses, which could be considered the lifeblood of the U.S. economy, face many risks. Just one unexpected incident — be it a lawsuit, a property disaster or an employee injury — can send them plummeting into the financial abyss. This is where the safety net of insurance becomes critical, providing a vital buffer against the unforeseen.
Some of the many reasons small businesses need insurance include:
Financial resilience
Imagine a fire consumes your store, wiping out years of hard work. Without property insurance, the cost of rebuilding could shutter your doors permanently. Insurance steps in, covering repair or replacement costs and allowing you to focus on recovery and getting back in business. Similarly, liability insurance shields you from the crippling expenses of lawsuits arising from customer injuries or product defects. These costs, often astronomical, can quickly drain resources and force closure.
Employee protection
Workers’ compensation insurance is more than just a legal requirement for most businesses with employees; it’s a lifeline for your workers. If someone gets injured on the job, medical bills and lost wages can be devastating. Proper coverage ensures they receive necessary care and financial support, fostering trust and loyalty.
Professional reputation protection
Insurance adds a layer of professionalism, demonstrating your commitment to responsible business practices. It shows clients, suppliers and investors that you take liability and risk management seriously, which enhances your credibility and builds trust. In a competitive market, such assurance can be the difference between securing a crucial deal or losing out to a competitor.
Peace of mind
Running a small business is inherently stressful. Insurance doesn’t eliminate every worry, but it provides invaluable peace of mind. Knowing you have a financial safety net in place allows you to focus your energy on growth and innovation, not fearing every potential disaster. This mental reassurance translates into better decision-making and a more optimistic approach to running your business.
While the cost of insurance might initially seem like a burden, it’s a far cry from the immense financial and emotional toll of uninsured incidents. Carrying the right insurance is an investment in your company’s future, providing a critical safety net that can help you weather any storm and keep your entrepreneurial dream alive.
Remember, in the fast-paced world of small business, the unexpected is inevitable. Don’t let it catch you unprepared.
Where you get your business insurance matters
No business owner wants to get sued or suffer property damage and find that their insurance provider can’t or won’t cover their claim. That’s why it’s critical to buy insurance policies from a reputable company.
biBerk is a great example. People trust them to “have their back” when the unexpected occurs. As part of the Berkshire Hathaway Insurance Group, biBerk has the expertise to help business owners select the right policies for their risks and the financial reserves to pay claims fully and in a timely manner.
Be sure to research these insurance policies
Many factors affect your business insurance requirements. However, you likely need one or more of these vital policies:
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General liability insurance. Also called commercial liability, this type of insurance covers risks like damage to others’ property, injuries to non-employees, slander, libel and copyright infringement.
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Workers’ compensation insurance. Most companies that have employees are required by their states to carry workers’ compensation coverage. It protects workers who are injured, contract an illness or die on the job. It can cover medical costs, legal fees and lost wages.
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Commercial auto insurance. If your business owns or leases vehicles, this policy provides protection if someone sues you over damage or injuries from accidents involving them.
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Business owners policy. A business owners policy combines protection for company property with general liability insurance. You may also hear it referred to as property and liability insurance. Often, it includes business interruption protection, which can replace income lost due to covered incidents.
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Errors and omissions insurance. Called professional liability insurance in some industries, this coverage can pay damages and legal fees if someone claims their business suffered financial harm due to your professional service.
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Umbrella insurance. Liability insurance policies have maximum values they will cover in the event of an incident. Umbrella insurance can pay costs that exceed the underlying policy limit up to the umbrella policy’s limit.
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Cyber insurance. This coverage helps cover costs related to cyberattacks where someone has stolen sensitive information and used it to commit fraud or is likely to do so. It’s often purchased as an add-on to another business insurance policy.
Whichever policies you purchase, having insurance protects your small business financially and can help you sleep better at night.
— Provided by MediaPeachy
The news and editorial staffs of the Baltimore Sun had no role in this post’s preparation.
Based in New York, Stephen Freeman is a Senior Editor at Trending Insurance News. Previously he has worked for Forbes and The Huffington Post. Steven is a graduate of Risk Management at the University of New York.