Choosing your small business insurance coverage can seem to be an overwhelming task at first glance. The problem is, besides the fact that you may not be sure what all the terminology means you also may not be aware of what coverage is required and what is simply nice to have.
The good news is once you learn a little about the basic types of small business insurance coverage the choices become much easier. The purpose of having insurance is to limit your liability and protect your investments, assets, and income.
Business property insurance can protect your company’s assets in the event of a natural disaster or other tragedy. In essence, this type of small business insurance could mean the difference between your business surviving such an event or becoming a total loss.
A devastating illness that prevents you from working can have a disastrous effect on your life and your business. Disability insurance can be used to replace your income in the event you are unable to work due to an accident or illness.
Small business insurance coverage needs should be carefully analyzed before decisions are made about what the policy should or should not include. Protecting your livelihood is a primary concern, but you should also compare prices.
In most cases the larger insurance companies offer quality coverage and good rates, but it does not hurt to ‘shop around’. Online comparisons can be completed quickly and easily. In fact, many insurance companies offer onsite comparisons.
Sometimes business owners find great bargains through trade associations or business groups. These groups can offer savings because of the large volume of business provided through the organization. Another advantage of purchasing insurance in this manner is that the organization has not only negotiated discounts, but they have also evaluated the specific coverage suggested for the particular group.
Do Home-based Businesses Need Coverage?
When working to determine your small business insurance needs you should begin by doing a complete business inventory. This inventory should include a list of all business property and its replacement value. This information can be used as a guide to help you determine what type of insurance and how much should be purchased to cover your assets.
The reality is that all businesses require some type of investment. In most cases the investments will include a mix of time, money and effort. Besides the drain on the budget there will be emotional drains to deal with. It’s easy to see why business owners want to protect their investments with small business insurance coverage.
Home-based businesses often have as much to lose as any small business in the event of a disaster or tragedy. It is wise to treat every business as a business from the start. This means keeping files to organize receipts and or appraisals. Two copies should be made and each kept in separate locations. This helps to ensure that one will remain safe even if disaster strikes.
A careful look at your financial situation will help determine what would happen if an injury or illness prevented you from working. How long could the business continue without you being there to manage things?
When a step by step approach is taken to evaluating your small business insurance needs the mysteries of insurance coverage seem to unravel before your eyes. Understanding your needs is the first phase to determining what small business insurance coverage to purchase.
About The Author
Debbie Allen of The Things Women Want has written several books, ebooks and thousands of articles and reports. Debbie has a background in Psychiatric Nursing, Nurse Education and Organizational Development which has resulted in several areas of interest and specialty.