While it is easy to view insurance as a cost, it actually adds value to your business. Unforeseen events, such as natural disasters, can put your business at risk of failure. The right insurance coverage can minimize the damage incurred by unforeseen events, helping you to avoid business closure. Let’s take a closer look at each type of insurance policy. Here are some examples:
Life insurance
Depending on your age, health and personal circumstances, life insurance is an important financial tool. When you have an existing life insurance policy, your beneficiary will receive a lump sum based on the amount of coverage you have purchased. The beneficiary can be anyone you choose. Life insurance policies protect you for a specified amount of time, and your annual premium stays the same. The policy benefits your beneficiary only if you die during the time the policy is valid.
Health insurance
In addition to its financial benefits, health insurance can also bring you peace of mind. Studies have shown that businesses often receive better insurance rates than individuals do, since their risks are spread across a larger number of individuals. Providing health insurance for employees helps your business stay competitive by increasing staff morale. Whether you are self-employed or are a part of a large corporation, health insurance is a must. It will not only protect your health, but your business’s financial future, as well.
Business liability insurance
If you own a small business, you need to protect yourself from high costs and liabilities caused by lawsuits. Business liability insurance covers costs associated with lawsuits involving your products or employees. If someone is injured or something goes wrong in your business, this policy will cover the costs of damages and legal fees. Having a liability policy is essential if you’re hoping to secure contracts and clients. Without it, your business could be in serious trouble.
Auto insurance
When buying auto insurance, you should know what you want and need. There are several types of policies available, including liability, comprehensive, and collision. Your coverage will vary depending on what you drive and your personal details. It is important to know that you can choose to pay more for more coverage if you are a young or inexperienced driver, and your insurance company may allow you to pay more. Also, when you purchase collision insurance, you will get coverage for any accidents that you are involved in.
Fire and hazard insurance
Most property owners choose a combination of homeowners’ insurance and fire and hazard insurance. The difference between the two is in the amount of coverage each type of policy provides. Homeowners insurance covers only their possessions, whereas hazard insurance protects your house in case of a fire or other catastrophe. This coverage also includes federal flood insurance, which is required for FHA and VA contracts and in federally designated special flood areas.
Business interruption insurance
When you’re planning to purchase business interruption insurance, it’s important to know what it covers. This type of insurance covers expenses that prevent your business from running during a disruption, such as lost income and repairs. The policy’s deductibles are also important to consider. Business interruption coverage is best if you’re unable to pay these expenses yourself. However, if your business is not profitable, a policy might not be the right choice for you.
