Even if you’re just a start-up, you need protection. Most of the time, small businesses have tight budget that results in omitting important requirement to run the business smoothly. In particularly, small business owners are willing to let go of insurance just to survive in few months or years.
However, insurance plays a vital role in keeping the business up and running. It acts as a shield from problems including claims and lawsuits, which may result to bigger problems in the future. If you’re unsure why you really need to invest with policy, you can ask professional and reliable insurance broker.
For a start, make yourself aware about the benefits of business insurance for start-ups below:
Requires by the law
The law requires that every business should particular types of insurance. Some of them are General Liability Insurance and Worker’s Compensation. This is a legal obligation that must be fulfilled. If you fail to provide them, it will result with fines, , exclusion from public contracts, and civil or criminal penalties.
Aids in responsibility towards clients
Any potential clients for your business may inquire if you have insurance. These clients or consumers know what they are looking for in a company and things that they don’t want. If you’re not able to provide them what they want, such as insurance, your credibility and reliability may be deemed as weak.
Liability insurance is the kind of policy that you should get. Hence, you should obtain certificate of liability insurance so when the clients ask for proof, you have something to show. This certificate acknowledges that you have insurance as well as the limits of the policy you have. Some details also include your business name, policy number, coverage type, effective date, and its expiration date. Always keep in mind that insurance is an asset, a form of investment that can be helpful in the long run.
Helps maintaining the office equipment
Insurance also plays a vital role in protecting your business operation equipment. All businesses, even the start-ups, rely on machines and sort of equipment to get the job done. So, what is better way to protect that helps your business run? It’s the insurance. Sample of policies that protects your business equipment is Commercial Auto Insurance and Property Insurance. You can ask your insurance adviser the best policy for you.
Keeps the business operation running
In the event of natural disaster like flood and earthquake, who will help you and your business? It’s only insurance that has the capability to cover any loss you have – property, equipment, building, money, and more. Not only that, your policy plays a vital role in helping the business survive disaster because it protects you against loss of income. It compensates operation expenses such as utilities and rent while recovering from catastrophes.
Attract more clients
If you have insurance and you’re signing a big client to work with you, there is a high chance that you’re able to close a deal with them. Business contracts require having Errors & Omissions Insurance, protecting both you and the client if something goes wrong. Maintain an active insurance will surely help you sign more clients in no time.
Protection for the employees
It’s not only the business operation that needs protection – employees deserve it too. In any business, manpower is essential in running the whole business; without them, the business may experience lack of growth or collapse as no one will execute the needed business operation. Employees are asset and it pays to protect them when accident happens.
In any business, the law requires to have Worker’s Compensation. But business owners should also consider providing disability coverage and any helpful policy for the employees. Remember that if you’re protecting your employees, you’re protecting also yours.
Legal activities and documents require it
In terms of entering in any business and legal contracts, insurance may be a requirement. Below are samples:
- Renting or leasing a business facility requires insurance. The landlord’s policy may not be able to cover it.
- For loan agreement involving money for financing building, operations, and equipment will likely to have insurance covering it.
- Some business clients may also ask if you have insurance, assuring them that there will be help in case things don’t go as planned.
Saves time for tax
Commercial insurance is tax-deductible, so it’s helpful to have it as business operating expenses.