May 20, 2011

How to Insure your Business

If you own a business, you know it's a full time occupation. It takes a lot of time and effort to get a business running smoothly and keep it that way. It also takes a lot of skill and hard work to make the business lucrative. Part of the process is to ensure you're financially protected from possible setbacks, and that means carrying a sufficient amount of insurance. Following are a few tips on how to insure your business.

Determine Your Needs

Determining how much insurance is necessary for your business to be adequately protected and continue to make money is among the first things you need to do. Take the time to look over all your assets. Find out how much your buildings and property are appraised for. If you produce a product, and it takes machinery to do so, determine how much it would cost to replace the equipment. If you have a fleet of vehicles find out how much they're worth. After you've collected all the pertinent data you should begin looking for an agency to handle your insurance needs.

Research Insurance Providers

In your quest to find the right company to provide you with the insurance you require, there are a number of factors to take into account. One of the first things you should do is seek out people who operate a business similar to yours and ask them if they'd be willing to talk about their insurance coverage. If they are, make an appointment and ask them if they're satisfied with their present coverage and the company that provides it. If they are, find out what it is about that particular company they like or dislike. Ask them if they would recommend their company or any other company. Take their suggestions into consideration, and give those companies a call. Discuss your needs with them, but unless you're absolutely sure you won't do better elsewhere, don't sign any papers yet. It would be better to continue researching. Shop around first. Get some online insurance quotes for comparison, and call additional companies to get their best price. Only after you're completely satisfied with a company and their offer should you take out a policy.

Things to Consider

The particulars of an insurance policy should cover any area that may present a financial problem if there is a claim against your business. Liability insurance will probably be your biggest concern. There are four major types of liability insurance you should be concerned with: general liability, product liability, professional liability, and discrimination liability.

General Liability Insurance

General liability is the most common form of liability insurance, and will safeguard your business in case someone gets hurt while in your offices or on the grounds.

Product Liability Insurance

Product liability is also an important consideration. It will give you financial protection against a claimant in the event they are injured by a product you produce, or become sick from it.

Professional Liability Insurance


The third type of liability insurance is only necessary for professional people, such as a doctor, dentist, or lawyer. Generally referred to as malpractice insurance, but more accurately called professional liability insurance, this type of coverage will protect the professional practitioner against lawsuits brought against them that allege they made a mistake that harmed someone.

Discrimination Liability Insurance

A somewhat newer form of liability insurance will protect the business against charges of discrimination, whether it is race related, or a sexual harassment suit, or any other form of discrimination.

Seek Professional Advice

After you've decided how much insurance your business will require, you should seek the advice of a professional, such as an accountant, an attorney, or a financial advisor. Go over your plans with them and have them make suggestions on how it could be improved. Once the bugs are worked out of your proposed insurance plan it's time to make the call to the insurance company you've chosen to provide your coverage.

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