Business owners have to learn a lot the hard way.
However, one of the things you should never have to experience is not having enough small business insurance to protect your company from a lawsuit. A single lawsuit can bankrupt an entire business if you don’t have adequate protection.
In case you need any more reasons to invest in business insurance, here are five.
1. Because you can't predict the future.
Regardless of what type of business you do, you have no way to predict what could happen while you’re working with customers or clients. Sure, nobody expects to get in a car accident when they pull out of the driveway, but we all wear our seatbelts anyway.
Similarly, you shouldn’t expect to get sued by every client you encounter. But, because insurance that protects against lawsuits often costs only a couple hundred dollars a year, it’s silly not to invest in this protection for your business.
2. Because you need to protect your employees.
If you have employees, then you need an insurance policy that will protect them if they’re hurt on the job. You also need a policy that will protect your finances if they decide to sue you over their illness or injury.
Most states require a Workman’s Comp policy of some kind, but every business is different. The risks that restaurant owners’ employees face are different from those that an accountant’s team has to deal with. To find a policy that makes sense for your team and the work they do, chat with an insureon agent who has experience finding Workers’ Comp Insurance for business owners in your field. To learn more about the cost of Workers' Comp, read our Workers' Comp Insurance Quote Analysis.
3. Because insurance allows you to concentrate on what matters.
The better your liability policy, the more you can concentrate on the work at hand, rather than worrying about being sued for the various situations your company may find itself in as it begins to grow and expand. In other words, business liability insurance policies give you peace of mind, which is a good company policy when trying to make a fledgling business more profitable.
4. Because having insurance means you can take more chances.
With less to worry about on a regular basis in your business's day-to-day operations, you can take more chances with your new business and put it into positions where it could really capitalize in its particular market. Obviously, this doesn't mean you can knowingly take unnecessary risks if you have insurance – basic common sense, safety procedures and general best practices are always important – but it does mean you'll have more peace of mind that can free you to recognize and go for more lucrative opportunities, while having your risks managed more prudently.
Of course, you should make sure that any new business practices you decide to take on are covered first. Maintaining a relationship with your insurance provider and keeping them up-to-date on what's new with your business is crucial.
5. Because it will make your business seem more trustworthy to potential clients.
Having business insurance shows your potential clients that you’re a safe bet. Why? Because insurance means that, if anything goes wrong with the work you do for clients, you’ll have the means to compensate them.
If they sue you, your insurance policy will pay for a settlement. If you damage their property while it’s in your care, your insurance will pay to replace or repair it. In addition to providing a safety net for you, your insurance policies provide a safety net for anyone who wants to work with you.
In other words, having insurance for your small business is as important as your initial business plan. While it may not keep your company from being sued in the first place, it will protect it from being wiped out or financially crippled by legal action. When you're a small company that's trying to get ahead, business insurance is worth every penny.