If you ask yourself, “Why do businesses need business insurance?” The answer is: Accidents can happen anytime. And when they do, it helps pay for the damages you would otherwise have to pay out of pocket.
There are lots of reasons why your company needs business insurance coverage. It helps to have the following:
- Save your time, money, and stress
- Protect your business from loss
- Give benefits to your employees
Which type of Insurance Does Your Business Need? Consider these business insurance coverages to make sure you’re protected:
- Commercial property insurance
- Business income insurance
- General liability insurance
- Data breach insurance
- Workers compensation insurance
The top 10 Reasons For Business Insurance Coverage
Here’re the top reasons to understand why you need business insurance for your company or business.
1. Business Insurance Is Required By Law
Most states need small business insurance. However, even if yours isn’t, you should still consider it. The benefits of business insurance can protect you from financial loss. Without it, your business could be at risk if:
- A customer sues you after he is injured at your place of business.
- Fire destroys your building or inventory.
- A computer containing your client’s personal information is stolen.
2. It Protects Your Employees
One it coverage that most states necessary is workers’ compensation insurance. If your employees suffer work-related illnesses and injuries, it provides benefits such as:
- Medical care
- Funeral benefits
- Missed wages
It’s crucial to know that workers’ compensation offers apart protection than unemployment insurance programs.
3. It Protects Your Customers
Your business insurance can also help cover your customers if you have a BOP (Business Owner’s Policy). These BOP (Business Owner’s Policy) policies combine business property and business liability coverage into one to help protect your business:
- Property damage
- Bodily injury
- Personal & advertising injury
- Product liability
For example, if one of your customer’s slips, breaks their leg, and needs to go to the hospital, your Business Owner’s Policy can help pay for their medical costs.
There is also data breach insurance to help protect your business and customers in the event of a security breach. For online businesses, insurance can help pay for:
- Identity protection solutions
- Legal fees
- Public relations
- Liability
4. It Builds Credibility
Your business insurance does additional than protect your business. Having the right policies in place shows your customers and contractors that you take risk management seriously. It also helps to let everyone know that you will provide perfect protection no matter what the accident.
5. Contracts May Require Business Insurance
Businesses like yours contract all the time. Therefore, it is vital to know that many contracts require insurance coverage. A few examples include:
- Renting building from your landlord
- Loan agreement
- Customer Agreement
- Borrow money to finance goods
6. Insurance Can Help Recruit and Retain Employees
When employees search for a job, they are looking for more than just a salary. They are also looking for the right benefits such as life and health insurance. Businesses without insurance oft miss out on attracting and retaining the best employees.
7. It Protects Management
Your management liability insurance can help cover the owner, CEO, or the “key person” who runs your business from costly lawsuits. Management liability insurance can help protect those who work for non-profit organizations and publicly traded companies. In most cases, you can include this type of insurance in your BOP policy.
8. Insurance Protects Against Natural Disasters
Most of the states suffer from various natural calamities, such as:
- Flooding
- Fires
- Hurricanes
- Lightning
- Tornados
This insurance is essential to protect your business property and the property inside it in the event of a disaster. You can also learn about flood insurance to help protect your business from damage caused by flood waters.
9. Company Insurance Helps with Lawsuits
Every company can be sued and face legal fees. One reason business insurance is needed is to help cover costs. For instance, if you have an injured worker who sues you, your workers’ compensation insurance may help pay for the legal charges. And, if that injured worker ends up with a disability, workers’ compensation can act as disability insurance and endow them with benefits.
10. Business Insurance Offers Peace of Mind
One question we’re oft asked is, “Why do I need business insurance?” A specialist can assist answer that every day. They can guide you through each of the insurance coverages and decide which property and casualty insurance policy best suits your needs.