Can I Protect My Business from an Unforeseen Tragedy?

Can you protect your business from an unforeseen tragedy? The short answer is: “Yes!” These days there are more ways than ever to make sure your business is fully protected in the event of a natural disaster, a product recall, a serious lawsuit, or any other potential danger. Getting business insurance, however, requires you to do a little research and analysis because the type of business insurance you purchase makes all the difference. The right business insurance can mean the difference between a long and prosperous business life and professional and personal financial ruin.

You can and should get business insurance tailored to the specific needs of your business. Part of protecting your business is determining where you are vulnerable. Every business should have insurance to protect the business property. This includes the building where the business resides if the business owns it and all of the contents of that building whether leased or owned. Should there be a natural disaster like an earthquake or a flood, you need to make sure your property is covered. Remember, however, that many types of natural disasters require additional insurance coverage.

Natural disasters are not the only tragedies that can harm a business. Power outages, structural failures, gas leaks, etc. can all force you to close your doors at least temporarily. While you’re closed, you are loosing money, and that’s why you have to carry insurance to cover income loss. This is usually included in a business property insurance policy, but not always. Income loss protection is crucial because a forced closure can be a tragedy for a business that could lead to bankruptcy.

Another unforeseen tragedy you have to protect your business from is a lawsuit. Whether a suit has merit or not has no basis on how much it could cost you. All businesses are vulnerable to lawsuits in one form or another, so it pays to have liability insurance. Liability insurance covers settlement costs, legal fees, and other expenses that come with defending your business against a lawsuit. There are several types of liability insurance, however, so you need to make sure that your business is property covered for its needs.

Commercial General Liability (CGL) is the type of insurance that protects you from suits brought about because of personal or advertising injury. This insurance pays for medical expenses and other payments your business is held responsible for. Most businesses will need this type of protection. Professional liability insurance covers your business against suits that arise from service related errors, negligence, or malpractice. Employment practices liability insurance covers your business against suits that arise from disputes over things such as discrimination, sexual harassment, and wrongful termination. It can be hard to determine how much liability coverage you need because settlements in these cases run the gamut, but you can use other settlements in your industry as a guide and discuss norms with your insurance broker.

There are other types of business insurance that can protect your business from a tragic end. Worker’s compensation insurance is an absolute must for any business that has employees. Commercial auto insurance is required if your business has or used vehicles regularly. Life insurance is recommended if your business has multiple partners. Which combination of coverage your business needs will depend on your industry and the specifics of your company.