Business owners have a lot on their plate trying to run a company and address the needs of clients. Though they may not have a lot of time to read though the details of insurance policies, business owners know they need solutions to manage their exposure to risks – such as accidents, injuries and loss of property. Let’s consider a few myths about business insurance that need to be debunked before you purchase a policy which doesn’t offer you protection for our specific needs.
Myth #1: My business doesn’t need or can’t afford coverage at the moment.
Fact – Anyone can be be involved in an accident at anytime, and having basic commercial insurance coverage or a small business owners policy (BOP) can protect your business from lawsuits and help cover damages, health care costs and more. If you don’t have business insurance when an accident occurs, you could find yourself liquidating the business to keep up with expenses. An insurance agent can find a policy fit for the size and scope of your business so that you have the coverage you need with a premium you can afford.
Myth #2: My small business is not required to carry business insurance.
Fact – While your small business or home business may not be mandated the state to carry insurance, it should be part of your overall risk management plan. Though your level of risk may be lower than that of a major corporation, small business owners without protection could find themselves personally liable for covering the costs of work-related accidents or damages. You have invested time and money to building your company, so it is essential that you protect that investment.
Myth #3: My home business is covered by my homeowners or renters insurance
Fact – Your homeowners or renters insurance policy do not always cover business-related damage or accidents. When your designated work space is within your home, any equipment, personal property or injuries within that space could be exempt from your homeowners coverage. A simply liability policy or business owner’s policy (BOP) can cover your computer and personal property from loss or damages, cover your space from liability for injuries or slander, and even extend coverage to times you are travelling away from your home business.
Myth #4: My business needs insurance to cover each client and contract
Fact – In most cases, you business insurance will cover multiple clients and contracts, however, it is a good idea to confirm your insurance will cover each individual case. Some fidelity bonds are only valid for one client or project. And for those projects which involve high risk activities, you might simply need supplemental coverage. Most policy have broad coverage and don’t require additional policies, but check with your insurance agent if you aren’t sure.
Myth #5: My Personal Umbrella Policy will cover my business too
Fact – Your personal umbrella is not likely to cover your business in the event of loss or injury. Most umbrella policies have limitations and exclusions – particularly for incidents involving commercial property or a home-business space. Read your contract carefully to determine what is and is not covered, then get a policy to secure your exposures.
Myth #6: My personal auto insurance will cover use for my business
Fact – Most personal auto insurance policies specifically exclude coverage for commercial use. Even if you car is your only vehicle, if you get in an accident while using it to drive to a client’s property or pick up office supplies, you might have difficulty filing a claim with your insurance provider. Personal auto insurance is designated for personal use, but if you are using your personal vehicle for numerous trips to support your business then you will need at least some basic commercial auto liability coverage.
Myth #7: My small business can’t afford health insurance
Fact – While it is true that health insurance costs are on the rise, health care insurers are acutely aware of the unique needs of small business owners. Whether you are self-employed from home or have a small operation with a handful of employees, there is an affordable health insurance plan for you. Some plans include high deductibles to curb the cost of business owners and others may be bundles with vision and dental for additional savings. And don’t forget about potential tax credits to small businesses offering health care to employees. It is worth noting that small businesses offering health insurance benefits to employees are able to attract and retain essential talent.