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Top 3 Reasons why you need insurance to protect your business

Sep 15, 2021 · 7 minutes to read

Happy business owner hanging an open sign at a cafe

Why your business needs insurance

Every business should consider insurance, for a number of reasons. One is that your business could face a lawsuit if it has been responsible, even if only allegedly, for an incident that causes harm to someone, illness, damage to property or financial loss. Even if you are incredibly careful and do everything by the book, you could still find yourself facing a lawsuit, for example numerous businesses used asbestos on their premises or in their products when it was thought to be benign; many of these businesses would have been bankrupted when facing the payments required to meet class-action lawsuits if they weren’t properly insured.

Liability insurance for small businesses can give you the reassurance that your company will be covered against future mishaps. However well run a business is, something can always go wrong, and a variety of business insurance exists to cover the potential risks. Every company’s needs are different, for example a company operating over several premises won’t have the same sort of policy as a company that only does business online.

What types of insurance you need

There are numerous different forms of insurance. Many small businesses choose a business owner’s policy (BOP). A BOP can offer coverage against liabilities, business interruption, and insures the property and premises of the business. This is an excellent choice for small businesses running out of “real world” locations, but there are many other forms of insurance available. You may also need additional insurance. You should understand what your risks are and what coverage is available to protect against those risks.

Is Business Insurance compulsory?

Whether business insurance is a legal requirement is dependent on the state in which you operate and the type of business you run. As an example, if companies have more than a specified number of staff, it will be mandatory to take out workers compensation insurance, meaning that if an employee suffers a work-related injury or illness, they will be protected. Every small business owner should check carefully on the regulations that pertain in their state, but even if insurance isn’t mandatory, it’s still an extremely good idea, for the reasons set out below.

Firstly, defending legal actions, even if they are vexatious, is extremely costly. You could be completely in the right but still, be faced with significant financial losses if you are not insured.

Secondly, insurance covers what is known as “acts of God”, things that happen to your business that was completely out of your control and that involve no wrongdoing on your part but could still cost you huge sums. For example, imagine a lightning strike hit a chimney on your premises, causing it to fall and injure a passerby. Under the “act of God” clauses in your insurance policy they would be compensated by your insurance; if you don’t have insurance, the costs come out of your pocket.

Thirdly, some insurance policies not only cover the financial losses you may suffer if found liable for an accident or illness, but they can also cover your costs if you suffer a loss of income through no fault of your own. An example would be if there was a flash flooding in your neighbourhood and you had to close your premises for a month for repairs; with the right type of insurance, you would be compensated for the income lost over this period.

Finally, insurance helps you to remain compliant. In many instances, it is a legal requirement to have an insurance policy in place that protects your employees. Even if nothing goes wrong, you could still end up with substantial financial losses from fines imposed for non-compliance.

What is covered by small Business Insurance?

As above, policies vary. Some policies will only cover the products you make and sell to the public (product-liability insurance), while others cover a wider field. As mentioned above, a BOP policy covers many different aspects of your business, including your property like machinery and premises. These are a type of “blanket” policy for US companies, insuring them against a number of potential hazards.

You need to consider the form of business you’re running and what the legal requirements are in your jurisdiction. Whether or not it is legal not to have insurance, it is frankly unreasonable not to have protection in place for your company and your employees, as nobody can guarantee that they will not experience difficulties at any point in their business life.

Liability examples for Business Insurance

Personal injury and claims for medical costs

Imagine you are unloading supplies from your car to take into your office. You put a box down for a moment to lock your car and a passing jogger who hasn’t seen the box trips over it and fractures their collarbone. In this instance, you could face a lawsuit for medical costs. Without general liability insurance, you will have to pay legal fees to defend yourself and, if you lose, any compensation awarded from your own pocket. With insurance, these expenses would be met (although bear in mind that all insurance policies have limits, so make sure you have sufficient coverage to meet all likely eventualities).

Claims for property damage

Imagine you are a restaurant owner and one of your serving staff trips up and spills a glass of red wine all over a customer’s designer white silk frock. The garment is ruined, and the customer demands $2000 to purchase a new one. This is a legitimate accident that occurred on your premises, and general liability insurance would help with the payment.

Invasion of privacy

Imagine you are in the building business and you have just completed a luxury addition to a customer’s house. Being pleased with your work, you take some photographs of the home and capture the client in the background cooking dinner, and put them on social media to show potential clients what you can do.

Unfortunately, the client sees your pictures and objects to you having used them without permission, suing you for breach of privacy. General liability insurance would help you defend the case and to pay any settlement if it is found against you.

Copyright infringement

Imagine you run a travel agency and, to advertise a special offer of holidays in Cancun, you put a collection of photographs of the destination on your website. Unfortunately, you forgot to check whether the photographs were in copyright, and the photographer has found your website and is suing you for breach of copyright. Your business insurance would help with your defense and any damages awarded.

Conclusion

Hopefully, you can see from above that the question that should be asked is not why businesses need insurance, but why would any business risk being without insurance. Sure, insurance can sometimes look like an unnecessary expense as years go by without you ever having to make a claim but carrying on paying premiums, but for even the best run business disaster could be just around the corner. To look after your employees and your customers, business insurance is a must. To find out more about the types of business insurance available, visit this website.

 

*As with any insurance, cover will be subject to the terms, conditions and exclusions contained in the policy wording. The information contained on this web page is general only and should not be relied upon as advice.

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BizInsure has really come through for me on some really hard to place risks. Andrew takes the time to understand the risk and work through how we can make it work, rather than looking for ways to say no. Thank you for your help!
Carlos T.
18:06 16 Mar 23
Very helpful and explanatory on the policy line of the policy
Josua V.
17:30 14 Mar 23
Worked with Tevin. Amazing customer service. Was very patient with me in figuring out the best insurance coverage for business. Thanks Tevin for making it easy.
Faisal O.
16:23 14 Mar 23
No complaints, Always a fast response when a need arises.
Dan F.
13:56 10 Mar 23
Very good information patience was shown. Much help from Kaled, satisfied with the amount of insurance and good coverage. Affordable is what you need with starting a small business until you grow. Old saying is go as you grow.
Jacquelynn W.
21:53 20 Jan 23
Professionals at what they do! easy to navigate and very good people to lead to to the best coverage!
Magnifier 2.
20:37 17 Jan 23
I have been shopping for business liability insurance for several months. I am happy to share that BizInsure ranked #1! The representatives were polite, patient, and empathetic. They accomplished what most companies struggle with achieving: they did what they said they were going to do, they were on time, and they had empathy. They delivered a policy for 25% less than the closest competetor, and even included $50k of cyber security at no additional cost! I only write reviews when I receive exceptional experiences- highly revommended; keep up the great service BizInsure!P.S. I own a professional referral service in Hawai'i and I am going to see if BizInsure offers an affiliate program.Aloha!
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05:51 23 Nov 22
They respond quickly and give you quotes immediately ...
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23:55 09 Nov 22
The agent that I spoke to was very experienced and could tell that I was new at this and was very understanding and took the time to explain everything to me.
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00:04 15 Oct 22
Easy to work with and very responsive. Glad to have them as my broker.
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Jasmine Q was on the spot professional, she knew where to direct me and explain to me my concerns and request; she delivered my personal information within minutes of me asking policy questions.That young lady is a true ROCK STAT!!!
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23:09 15 Aug 22
For a small non-profit, the package I was given was affordable. The representative was polite, patient, understanding, and knowledgeable.
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18:06 15 Aug 22
Asked for a specific venue to be place on our certificate of insurance and it was done within one business day. Yay! Bizinsure!
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The process was fast and easy and the professional staff was very knowledgeable with any questions that I had and ready to help
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Friendly agents. Timely replies. Fair pricing. This is a good fit for my business! Thank you, Noah, for all your help.
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They are awesome
Tony H.
00:41 07 Jan 22
Noa made sure I had all the information I needed for a first time business owner . He helped me understand what I needed to secure a quality policy and he was super helpful when explaining how the policy would serve its purpose to my company. I was very satisfied and had an Awesome experience, I think people like that make the company look good!
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04:36 15 Oct 21
I was in need of WC, GL and PL coverages for my business and was able to shop, discuss, confirm and purchase all the coverages in two days! This was a great experience, especially when "Time is Money". Noah Bowman was very professional and knowledgeable. Thanks!
AmeriCreed 1.
15:42 23 Sep 21
MOVING FORWARD, I WILL BE SENDING ALL OF MY BUSINESS TO THIS COMPANY !!!! Incredible customer service!!! Thanks
THEODORE W.
19:49 09 Sep 21
Their representative clearly explained different kinds of policies to help me select the one appropriate for my needs and then helped me enroll by phone painlessly. By the end of the call, I had a policy in place.
Dissent D.
22:21 02 Sep 21
Eugene was Awesome!!!!
Lakesha G
17:19 21 Jul 21
Excellent solution for writers and authors professional liability policy as well as coverage for copyright and trademark infringement. Service was prompt and excellent.
Lane
18:22 22 Jun 21
Done in less than an hour!
William O.
00:30 02 Jun 21
Efficient, and great value. The agent was able to give us a quote and a new policy in a short period of time. Thank you
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20:30 24 May 21
I had a great experiencing obtaining several of my insurance needs as a landscaping company here in Northern Colorado. BizInsure's team took care of my needs and was very responsive to help with paperwork needed to secure a potential client account!
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16:34 10 May 21
Very efficient they were able to help me out with my request promptly....highly recommend this companyI am very happy to have them
Elba P.
18:50 26 Apr 21
I need a help getting errors and omissions insurance along with general liability. Jose was very friendly informative and was very patient with me during the process. He found me some of the best rates for the coverage that I needed. Highly recommend
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19:51 20 Apr 21
I had numerous conversations with several business insurance agents over a month's time. I also had several conversations confirming the policy inclusion/exclusions and asked many questions. My BizInsure agent was professional, knowledgeable and most important—detail oriented. Even after having an initial conversation a month earlier he knew and *remembered* all my personal/professional insurance needs. When I asked for additional information on the third call he was able to provide me with details very quickly. He was also VERY patient. That is a big plus in my opinion. It illustrated a high level of respect for my needs. I also found when I called back and asked to talk with the initial agent, the person who answered the call was able to get in contact quickly and my agent responded and returned the call within 5-10 minutes. The transaction was smooth, and I think it's a good sign should I ever need to make a claim. I highly recommend BizInsure.
Poetic F.
21:00 07 Apr 21
The rep was extremely helpful actually lowered my quote and made sure I was covered to fit my needs with my growing business! 5star!!
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19:04 16 Mar 21
Excellent service and prices.
Cassiopée V L.
23:13 09 Mar 21
Mr. Daniel Scott was very responsive to my professional needs.
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17:38 18 Feb 21
Eugene deserves a raise! First time purchasing insurance and he made the process so simple for me. His patience and attention to detail left me feeling confident in my decision to choose BizInsure. Gracias Eugene!
Esined P.
23:32 17 Feb 21
The customer service provided by Jose was outstanding. He explained everything in a very clear/logical way and answered all of my questions. After providing all the information to obtain general liability insurance, Jose sent me the declaration page of the insurance for review. All of the information matched what I provided over the phone and there were no typos. The next day I called back to purchase the insurance which was easy and fast. Overall, my experience with BizInsure including the customer service by Jose exceeded my expectations.
Joe W.
03:29 12 Dec 20
Hiscox/BizInsure made getting Liability Insurance very easy and reasonable.I expected it to be a long and complicated process and it was a nice surprise that they made it so uncomplicated. Thank you. Lisa
Lisa W.
21:51 24 Nov 20
Eugene was incredible. I called 4 other brokers before him who were impossible to get any help.
rhonda H.
23:26 12 Nov 20
Very quick to get in touch with you and good with follow up. Had some trouble retrieving my quote to log into my account initially but Daniel assisted me and the changes were made to get me into my account. Great value for the money.
Fran S.
16:34 20 Sep 20
Very happy to be insured with this company. Professional, Timely, very helpful. Thank you Juan, you made it so much easier for me to understand.
Aileen D.
19:55 15 Sep 20
This company responded when I needed them to respond while facing a deadline. They are an excellent choice for business Insurance.
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01:52 12 Sep 20
Jose Quintero took such great care of me and was very patient explained everything I did not understand and got me set up quickly. Fabulous customer service
Christina R.
02:41 27 Aug 20
I can't say enough good things about Daniel Santos kind and effective communication skills as an insurance agent. Daniel was so pleasant, friendly and efficient with helping me obtain insurance as a teacher. If I were to give Daniel a grade, he has earned an At . He made the process easy to understand, it was far easier than what I anticipated. Nancy S.
Nancy S.
00:47 26 Aug 20
I was in need of professional liability insurance for my sole proprietorship. A friend referred me. Everythng was quick and simple and AFFORDABLE!
hope J.
20:31 25 Aug 20
If you need Private Home Care Provider insurance for your company, BizInsure, LLC can get it for you!
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16:45 24 Aug 20
Great and fast service!!!! The representative was very professional!!!!
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19:51 14 Jul 20
I was tryi9ng to find commercial liability insurance for my new comp-any and BizInsure was easy to use and very affordable which is great for me as a new business.
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19:01 14 Jul 20
Great service insurance prices are great for professionals looking to get insurance for businesses....
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22:34 22 Jun 20
The provided very professional service and made the process easy.
Paul R.
21:51 04 Jun 20
Bradley Hoyle from the Biz Insure team was excellent to work with. Everything was quick and smooth. Great service, much appreciated!
Kristene S.
02:03 04 Jun 20
Anthony Spencer was great!! Very quick response time!! He was very Professional! I would suggest him because he helped me find a affordable rate and explained all the technicalities..
Fre H.
16:38 28 May 20
I was referred to Bizinsure by a industry trade group that I am a member of. It was easy to get a quote online and then received excellent customer service from Bradley H. to complete my policy purchase over the phone. I have shared this company information now with other business owners for their policy needs.
Dawn T.
22:11 08 May 20
This company was very precise with explaining services and made sure I chose the right business insurance coverage, great customer service at purchasing.
Nekeisha B.
01:30 05 May 20
Amazing
Jasmine Q
14:31 02 Dec 19
Trish is the most patient, professional and understanding insurance agent I’ve ever worked with. Trish has taken care of all my business insurance needs for the last couple years. I am really happy that I found an insurance agent that I know will take care of me & all of my concerns. I feel like a valued customer & I appreciate the great customer service that I get every time!!THANK YOU!
Dr. Youssef C. A.
17:21 14 Nov 18
Tricia helped me get insurance for my business. The task of obtaining a quote was really starting to frustrate me until I was referred to BizInsure through a different agency. Tricia got me a quote fast, and even took a down payment over the phone and issued the proof of insurance the same day. a+ service, would do it again in a heartbeat!! Thank you!!
Josh M.
18:07 22 Jun 18
BizInsure was a great find! I did not have to fill out applications, and Tricia was able to quote and bind business insurance for me within half an hour.
Allison Y.
17:28 21 Jun 18
Started doing business again and needed a policy fast. Ramez was reasonable, helpful and the rates are OK. Buyer beware? Sure, for me it turned out OK this time. Worth a call.
Mark W.
23:42 13 Nov 17
Great customer service. I've been very inpressed with my dedicated representative that had helped me navegate my insurence needs. Thanks so much!
Graham B.
22:12 23 Jun 17
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