Many people dream of owning their own successful business someday. The best way to start is usually by establishing a small business. But why do you need insurance for your small business?
It’s a well-known fact that operating any business comes with risks. Yet many small business owners assume that they can get by without insurance. However, the freedom that comes with working for yourself also exposes you to unique risks. You may be thinking to yourself: “But what could possibly go wrong without business insurance?”
Here are just 5 things to help you put things into perspective:
1. Getting Sued by a Client
Imagine one of your clients slips and falls within your business premises and decides to sue your company. Maybe you accidentally drop some equipment on your client’s floor and cause some damage. What do you do? This is where an insurance policy comes in handy, especially General Liability Insurance. What seems like a minor accident may end up costing you an arm and a leg, but with insurance, you have a safety net. In fact, there are times when small business insurance by Next Insurance can be the difference between bankruptcy and your company’s survival.
2. You Could Get in Trouble With the Law
In every state in America (except Texas), every business is legally required to have particular types of insurance, for example, workers compensation and unemployment insurance. Failure to comply with the law may cost you in terms of criminal or civil penalties. In fact, you may even get locked out of bidding for any public contracts. Hey, it’s cheaper to just pay the insurance premiums!
3. Financial Loss Due to Commercial Property Damage
If a storm were to damage your home, you would expect your homeowner’s insurance to help you pay for the damages and replace your assets. The same logic applies to your business. Acts of God such as earthquakes, tornados, and fires happen suddenly and without warning. Your commercial property can be affected at any time, so you need to be prepared at all times.
4. Financial Loss Due to Employee Injury
As an entrepreneur, one of the most valuable assets in your business is your labor force. Forget what they told you in business school about how to focus only on your products and services. Your employees are the vital cog in the wheel that keeps churning out profits. You must take care of their interests by providing workplace compensation and disability insurance. They protect your business from lawsuits and liability claims filed by disgruntled or injured employees.
5. Loss of Business Credibility
The truth is that most clients, business partners, and even landlords will only work with a company that has insurance. Being insured gives you credibility and shows clients that you are responsible. You don’t want to lose out on great office space or big contract because you don’t have General Liability or Property Insurance.
Whether you are an independent contractor, a fitness coach, or operate a cleaning company, you are going to need some type of small business insurance. There is simply no way around this fact.