5 Ways To Reduce Your Business Risk With These Types Of Insurance Policies

Recently updated on October 25th, 2022 at 11:15 am

With the uncertainties of this economy, it’s essential to make sure you are doing everything possible to protect your business. Insurance policies can be an excellent way for small businesses to reduce business risk. By providing liability protection that will pay out if something happens. Please make sure these types of Insurance Policies are reviewed every year at the least. So they stay current with market changes, etc.

Here are 5 best business insurance policies:

1. General Liability Policies

Protects against injury and property damage, claims to arise out of premises. Also operations, products manufactured/sold by you on others’ behalf, advertising torts, etc.

This includes product liability which covers anything. From defective products sold through retail to manufacturing defects that cause harm. The General Liability policy is vital for most small businesses.

2. Business Auto Policies

Protects against losses that happen to your business vehicles while they are in use. (You must own them) and also provides coverage when you’re hiring or borrowing autos on an occasional basis. Like when you’ve rented a van to move furniture. It will not provide liability protection if someone gets hurt in the auto accident, though! These can be expensive, so make sure you know what type of driving your employees do with their work vehicle too. 

3. Workers Compensation

If you have employees, they are entitled to Workers’ compensation coverage. Suppose a team member is injured on the job or becomes ill due to work conditions. State laws vary, but most states require employers to insure their workers for this type of loss. It can protect against lawsuits if you’re already insured with proper limits! Regardless of whether a worker’s negligence or carelessness caused the injury.

4. Business Umbrella

This policy can be an excellent backstop for all your other policies. It provides liability protection on top of the coverage offered by your homeowners’ or renters’ insurance, auto, and general business liability. Umbrella policies are often sold as an optional extra with limits up to $20 million. They provide very affordable extra protection. But do not cover anything covered under another existing policy you may have.

5. Business Property Insurance

This is the type of insurance you need if your company owns furniture, fixtures, and equipment (FF&E) or leaseholds improvements to property leased by it for business purposes. It will provide coverage for loss of use and physical damage to buildings and contents owned by the insured party. But does not cover wear & tear, gradual deterioration, inherent vice, or any other cause that may be excluded under this policy’s terms. Remember, insurance companies get to raise their rates every year. So it’s essential to stay active and on top of this part of small business management.

Here are five ways to reduce your risk with these types of insurance policies.

One way to reduce your business risk is by hiring a professional insurance agent. They will create an individualized plan based on the type of business you own and how it operates. This will help protect yourself, employees, customers, and more from unexpected incidents in the future.

Another excellent way to reduce your business risk is by purchasing various insurance policies, including property or casualty coverage. These are designed for risks such as theft, accidents, or natural disasters. Which may affect businesses depending upon their specific needs.

Small business insurance is another way to reduce your company’s risk. It covers small businesses against certain events that might only affect small businesses and no other individuals or groups. It can cover a wide range of things, including property damage, medical expenses for employees/customers, product liability, and more—depending upon what you choose for coverage. The amount needed varies from person to person. If you own any small business, it will be beneficial to invest in some type to protect yourself and others involved with your company correctly.

The last three ways to lower your small companies’ risks are by using employment practices liability (EPL), professional errors & omissions (E&O) and cyber risk insurance. EPL is a type of liability that covers employers against certain types of employment-related lawsuits, including discrimination, sexual harassment or negligent hiring/firing.

E&O can help protect you from mistakes made by your employees when dealing with clients. Providing incorrect advice or information may result in legal costs for the small business owner if they get sued over these issues.

Cyber risk insurance is another way to cover yourself from risks associated with technological advances within our society today. This includes damages done through data breaches, theft of company secrets and more. So it’s good to have some coverage if something terrible occurs via new technologies being released into the world each day.

Conclusion

A business owner should always make safe and responsible choices. These include small businesses insurance which holds the responsibility for damage done by employees’ mistakes and errors at work. It’s essential to remember that receiving a quote is not purchasing an insurance policy (yet). This means you do not owe anyone anything until you sign on the dotted line or electronically.