Managing business comes with several risks– an employee getting injured on the job, the occurrence of a natural disaster destroying your assets, or a demanding client filing a lawsuit.
For these and other causes, it’s critical to protect your properties and assets, both personal and business. And the best way to do so is by making sure you and your business are insured.
Let’s talk about the reasons why it’s imperative to get insurance for your business.
It’s the Law
The U.S. SBA states that the law mandates businesses with staff or employees to provide certain types of insurance, including unemployment and disability and worker’s compensation. However, this would vary depending on the state where the company is established.
Not complying with your legal obligations could lead to civil penalties, cease and desist orders, and fines. Combined, these things could cost you more than the price you have to pay for an insurance policy.
The Risk of Getting Sued
We live in a disputatious society. In every liability claim or lawsuit, there’s a high chance that your business could go down, and it even gets higher without insurance. One broken contract, accident, aggrieved employee, and all your efforts will go to waste. And even though you win the case, you can never get back the money you spent on legal defense.
Reduce your worries about losing a case to a truck accident lawyer or a labor attorney by insuring your company. It will help you have peace of mind, focusing on other important things.
Maintains Your Business
Many things could happen to your business, and that is why there are several ways to have it insured. For instance, natural disasters like floods and earthquakes can destroy your physical assets. There is no way to recover the loss when this happens unless an insurance policy covers it.
It’s during these situations where you’ll truly appreciate the importance of being insured. It keeps your business up and running, giving it the chance to survive natural disasters by protecting you from loss of income.
One kind of business insurance you need is the BOP or Business Owners Insurance. How does it work? Here:
- Pays the company for the income it would have earned while the business isn’t operating due to disasters.
- Compensates the business for daily operation costs (utilities, rent, etc.)
- Pay employees for a year even though the company is not operating.
Boosts Your Credibility
You probably haven’t thought of this reason: Being insured is a great way to boost your company’s credibility.
Insurance gives your clients and loyal consumers the perspective that it’s safe to deal with you. If anything goes south, you can compensate. Certain companies include the term “insured” in their statements. It promotes trust, a critical component in modern business operations.
Protection for Your Employees
A business’s most valuable asset is its employees. Apart from ensuring that you offer quality products and services, you have to invest in your employees. After all, protecting your employees pays well in the end.
The law requires worker’s compensation, but it would be wiser to include disability coverage. You may opt to pay for the total amount, but some companies charge their employees a part of the total cost.
Compensate for Acts of God
Acts of God in insurance language are described as any event not caused by human error. Fires, tornadoes, floods, and hurricanes all qualify under this category. There are two types of policies for acts of God: All-risk and peril-specific.
All-risk insurance policies cover all kinds of events or accidents even though they are not included in the contract. Meanwhile, peril-specific policies only cover those that are mentioned in the policy.
Helps in Retaining Employees
Employees tend to be loyal to employers who show gratitude through insurance. They know that in case of emergencies, the company can compensate them. Thus, encouraging them to stay longer with their employers.
Insurance policies can also attract more job seekers. Applicants are smarter nowadays, and they don’t just look at the paycheck. They also check the benefits they’d get working for a specific company. If you don’t offer such perks, you may lose an exceptional employee to a company that provides protection.
Because the Future Is Unpredictable
Insurance policies are designed to protect the insurer from what might happen. And if there’s one thing that we can all agree about, it is the fact that the future is unpredictable. You will never know what might happen that could affect how your business operates. Having insurance can guarantee that your company will stay afloat despite facing different challenges.
In summary, proper business insurance can help small and medium enterprises achieve their short-term and long-term goals. It also allows them to stay focused on more relevant operations and make a profit.