Running a business is a delicate balancing act that requires business owners and executives to balance between expenses and income. Since the main objective of a business is to make a profit, gross income must always be much greater than the total expenses. While expenses can easily be contained, there are some unplanned expenses which may crop up. For instance, a commercial vehicle may be involved in an auto crash leading to tens of thousands of dollars in losses. The business will have to absorb this loss. As a result, profitability will reduce. In some cases, a business may operate for several years without breaking even or reporting any profit.
There are many other types of liabilities that businesses are usually exposed to. Business owners must put in place measures to protect the enterprise from liabilities that can dent the company’s finances. Fortunately, there are many business insurance solutions to suit the needs of different types of businesses.
Buying Commercial Insurance for Your Business
Commercial entities are often exposed to a wide range of risks. This includes lawsuits, injuries to employees, fire damage, burglaries and many others. The ideal commercial insurance policy should protect the business from every possible liability that may arise. Before buying a commercial insurance policy, business owners are advised to look for a competent business consultant or a reputable commercial insurance broker. An expert in the field will assess the liability coverage needs of the business as well as the extent of liability coverage they should carry for different types of liabilities. Once this is settled, the next step will be to find the right insurance company and insurance products.
Run a Healthy Business With the Help of Commercial Insurance
Commercial insurance is simply meant to protect a business against losses arising from liabilities such as fire damage, storm damage, flood damage, burglaries, drastic reduction of business income, lawsuits and many others. The ideal commercial insurance policy should cover the following business risks:
1. Injury Lawsuits
This is the biggest threat to businesses. A thriving business may have to close shop if an injury lawsuit is successful. A customer may slip and fall within the business premise and decide to sue the business owner or the business itself. A customer can also decide that the goods you sold them or services they received from you caused them injury in one way or another. Whatever the case, lawsuits are costly to fight. In case you are not successful in your defense, you will be ordered to pay a large amount of money as damages. The ideal commercial insurance policy should provide sufficient general liability coverage. This will help to ensure lawsuits, whether malicious or valid, do not affect your business adversely.
2. Commercial Property
Fires, storms and other types of disasters can cause huge losses to your business. Burglars, thieves and vandals can also cause significant losses. Every business should have commercial property insurance to offer protection against losses occasioned by the events listed above. When purchasing an insurance policy, make sure that all the liabilities are covered sufficiently.
3. Injury to Employees
Employees can be injured while at work while others can develop illnesses after working in a poor work environment for a long time. Whatever the case, injuries sustained by workers qualify for injury lawsuits. This means that injured workers can file injury lawsuits when they are injured at the workplace. To prevent this from happening, employers are required by law to purchase workers compensation insurance to not only protect their employees, but also their businesses. After all, injury lawsuits are detrimental to the health of a business. Workers’ compensation ensures that workers not only get the best medical attention, but also receive at least two thirds of their average wages for the duration of their recovery period. In return, they give up their right to sue their employer.
4. Accidents Involving Commercial Vehicles.
When a commercial vehicle owned or leased by the business is involved in a crash, the resulting property damage can be quite significant. To protect the business from these huge losses, it is recommended you purchase commercial vehicle insurance to protect not just the vehicle, but also its cargo.
What to Consider When Purchasing a Policy
Obviously, premiums are a key factor of consideration when purchasing an insurance policy. However, this is not the most important factor. The types of liabilities covered by a policy is perhaps the most critical factor of consideration. You will need to read the inclusion clauses section of a policy to find out what is covered. Also make sure you read the exclusion clauses to find out what is not covered by a policy because you do not want to get any surprises later on.
The extent of liability coverage or liability coverage limits must also be checked. If you want coverage against lawsuits, you must ensure that the coverage limits for both legal fees and damages are sufficient. If not, consider paying more premiums to get better coverage.
The premiums charged by an insurance company must be checked because you want to get the best coverage at the lowest cost possible. A competent insurance broker can help you find the perfect commercial insurance policies for your business.