No one can predict accidents at work and the extent of the damage they will cause. As a small business owner, there are certain risks that you are exposed to, and you have to protect yourself from them. One of the ways to protect yourself and your business is by purchasing certain insurance covers. Some of the various types of insurance you should invest in are discussed below.
Product Liability Insurance
This type of insurance protects your business in case a product at your workplace causes an injury to a person. Even though you may take as many measures to ensure that your work equipment is safe to use, you may still find yourself sued should an accident happen. That is why you need to take the product liability cover. However, it is also good to ensure that your work environment is safe by maintaining your equipment. If you hear unusual noises while either you or your employees are using a machine, it could be a sign that it needs to be inspected or repaired. Therefore, have it checked to prevent an accident.
Whether your business owns property or leases a space, property insurance coverage is a necessity. This policy protects you in case of theft, fire, or vandalism. Such damage usually affects your personal property like office equipment, inventory, or computers. As a result, it interrupts your business, leading to loss of revenue. Therefore, you may want to consider protecting your earning as part of this policy. You may find that a loss from an earthquake or flood is usually not covered under property insurance. If your business’s location is in areas prone to such issues, you may have to purchase a separate policy.
Worker’s Compensation Insurance
The moment your business gest its first worker, you need to take a workers compensation insurance policy. This type of insurance coverage is often mandatory in most states, and non-compliant companies can face stiff penalties. It is essential if your employees are doing high-risk work, like welding. A dangerous hot spatter can reach about 35 ft from the welding area, causing burns, eye injuries, or sparking fire hazards. This puts your employees at risk.
When an employee is injured at work, this policy covers all costs arising from the injuries, like medical costs and lost wages. Once an employee accepts such benefits, they relinquish the right to sue your business. As a small business owner, it is crucial to protect your business and yourself from legal matters by purchasing this kind of insurance.
Errors and Omissions/Professional Liability Insurance
This type of insurance cover protects businesses in case of claims resulting from inadequate services rendered. This type of policy is not the same for all industries. Depending on the industry you are in, professional liability insurance is usually customized to fit the needs of each specific sector. This type of insurance cover can be used by a mental health counselor, a beautician, a photographer, a business consultant, etc.
For example, an accountant in charge of managing a client’s accounts, including filing taxes, may make an error, which results in the client losing a ton of money. When such situations happen, the client will end up filing an errors lawsuit. If the accountant has taken the professional liability cover, the insurance company will cover a certain amount of the payout demanded by the client.
Commercial Auto and/or Vehicle Insurance
If you are using vehicles as you run your business, they must be insured against liability in case of an accident. In a year, the U.S. roads witness over 5,891,000 motor vehicle accidents. That is a high number and necessitates the need for car insurance. You may opt to take a comprehensive policy that covers both a third-party injury as well as your vehicle. However, most businesses choose to only insure against damages caused to a third party. If your employees have personal cars, their individual insurance covers will compensate them for any losses resulting from an accident.
You can avoid a significant financial loss by purchasing the right insurance policies for your business. Depending on the type of business you are running, talk to an insurer and determine the type of insurance that your business requires.