Top 5 Reasons Why Small Business Owners Need Business Insurance
Running a business can be both rewarding and challenging for many business owners. It takes a lot of work and determination to build and maintain a successful business — and protecting that at all costs remains vital today as many businesses have been forced to shut their doors.
Numerous risks are associated with running a business successfully; and this can stem from a client or business filing a lawsuit against you, an employee gets hurt on the job, a natural disaster destroys your business, government restrictions, and much more. For these and many other reasons, it’s absolutely critical to protect your business.
Having business insurance is one of the best ways to protect your business. Without a particular business insurance policy in place, you won’t have access to the security and coverage your business needs.
Here are the top 5 reasons why business owners need business insurance:
1. Required By Law
Most states require businesses to have insurance and you should view it as a necessary expense. Without business insurance, you can suffer major losses. Most states require small business owners to have workers’ compensation insurance for new employees. If you have business vehicles, you’ll also need commercial auto insurance. Your personal auto insurance policy will not be enough unless you are using the vehicle strictly to commute to an office and the vehicle is not used in the course of business.
Failing to comply with state insurance regulations can result in fines, criminal, and civil penalties. Your business may also be excluded from public contracts, which will cost you more than the price of any insurance policy.
2. Protect Your Employees
Running a business with employees requires a lot of responsibility. Your employees are the most valuable asset, and that’s why you should protect them. Workers’ compensation insurance provides some benefits, in case your employees suffer work-related injuries or illness. The law often requires you to have workers’ compensation insurance especially if you have 5 or more employees in Tennessee and Georgia. If you were to get very sick with a serious illness or be injured on the job, do you have a plan in place to continue receiving your income despite being out of work for an extended period of time? If not, you should definitely consider a Disability insurance policy, as it protects your very livelihood and that of your key employees.
3. Protect Your Customers
A Business Owner’s Policy included with a business insurance policy can also help cover your clients. This consists of business liability and property coverage, and helps protect your business from property damage, product liability, and personal injury.
4. Protect Yourself from Lawsuits
Any business is prone to legal issues and cases. Lawsuits can be caused by numerous events and have many implications to your business. Causes of litigation in business include workplace accidents, broken contracts, unsatisfied employees, and much more. Having business insurance helps protect you and your business from any unwanted lawsuits.
5. Enhance Your Credibility
The benefits of business insurance go further than protecting your business from risk, it makes your business look credible. With the right policies, your clients and contractors can see that you are mitigating the risk seriously. It also shows your prospective clients and contractors that you are a safe company to work with. In case anything happens to the work that you are doing for them, you have a way to compensate. It builds trust, which is valued heavily in business.
At Insurance Advisors of Tennessee, we take the responsibility of insuring local businesses very seriously. Making sure you are covered adequately is our top priority! Call us today at 423-485-3078 to learn more about which coverages you need — all at an affordable price.
My friend wants to get a business set up, but he’s afraid of financial risks. It makes sense that he might want to get a business insurance plan to help out with things! That seems like a good way to ensure that he’s protected from financial risks.