Insurance can protect you against all kinds of business disasters. But just what types of coverage should you take out? No business can afford to insure themselves against every conceivable danger, so you need to choose which coverage is most important. Below are some tips for choosing the right policies.
Know which insurance schemes are mandatory
While most insurance policies are optional, there are times when certain policies may be required by law. A few examples of mandatory insurance schemes include:
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- Worker’s compensation insurance: If you’re an employer, you must take out worker’s compensation insurance. This provides financial compensation to any employee that is injured or made ill as a direct result of work.
- Commercial auto insurance: If you drive a vehicle for work purposes, you must also take out a commercial auto insurance policy.
- Medical malpractice insurance: Medical practices are required by law to take out medical malpractice insurance. This provides compensation in the event that a patient is injured or dies as a result of negligence
Some other industries like law and real estate may have other compulsory insurance schemes. Make sure to prioritize these insurance policies.
Identify the biggest risks to your business
When it comes to optional insurance schemes, there are an endless choice of policies to consider. It’s best to focus on the biggest risks – these could either be the disasters that your business is most likely to encounter or the ones that could cause the most amount of damage.
For example, most store owners will take out commercial property insurance to protect them from theft and vandalism. Many tradespeople meanwhile see it as worthwhile to take out public liability insurance – which provides compensation if a customer gets injured or a customer’s property gets damaged as a result of your work.
Certain risks may not be worth insuring against if you feel you have other protection in place. For example, you may not see the point of insuring equipment if it’s covered by a warranty, or taking out cyberinsurance if you outsource cybersecurity services (as technically the liability can be passed to them).
Look into industry-specific cover plans
Sometimes it’s worth looking into industry-specific plans. For example, freight transportation insurance could be worthwhile taking out if you are a freight transportation company as this can cover you against the unique risks your businesses face such as goods getting lost or damaged in transit.
Similarly, if you’re a dentist, you can take out dental malpractice insurance – a specialist type of medical malpractice insurance aimed at dentists. While you may still be able to cover yourself with general medical malpractice cover, this dentist-specific cover may focus more on the risks that your business faces.
Save money on multiple policies with bundles
It’s possible to take out business insurance bundles. These contain multiple policies such as worker’s compensation, public liability and commercial property insurance which you pay for in one monthly payment – often at a hugely discounted price compared to if you took them all out individually. This also eliminates the hassle of having to shop for different individual policies.
There may even be business insurance bundles out there that are specific to your industry. For example, some niche insurers may provide plumbing insurance, which may include multiple policies like worker’s compensation, public liability and tool damage cover all bundled together and targeted at plumbers.
Most insurance bundles are a convenient and cost-saving option, but be wary that there may be some that aren’t as much of a bargain or that may not include all the policies you need – by comparing bundles, you can find the most affordable and the most comprehensive solution.
(Contributed Content)
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