Before your first day in business, you will want to consider all the potential insurance policy options your company may need. With the wide variety available, it can be hard to know where to start. Below is a guide to help you learn which steps to take to best protect your business investment and effort.
5 Business Insurance Considerations
1. Understand Your Business’ Legal Coverage Needs
Talk to an insurance professional to see what coverage your business is legally required to have. Depending on the size of your business, you may be exempt from having to purchase certain policies. For example, Alabama's workers' compensation law mandates that small businesses purchase workers' compensation coverage if they hire five or more full-time or part-time employees.
After you cover the legally mandated basics, decide what else you would like to add on. For example, you can purchase general liability coverage to cover any accidents or injuries as well as commercial property coverage to protect equipment from vandalism or theft.
2. Know Your Industry’s Risks
What type of industry does your business fit into? You will incur different risks depending on what you offer. For example, serving food to customers or handling personal financial information will necessitate different policies.
Product liability coverage will cover any products you distribute, while professional liability coverage will cover any services that you provide. Consider if you are more likely to need professional or product liability protection so that you can cover any bills or lawsuits that might come your way.
3. Prioritize Coverage Over Cost
Protecting yourself from all angles is essential when owning and running a business. Do not skimp on coverage options because of price. These costs are crucial to keeping your business open and protecting you from detrimental financial setbacks. Choose a policy that matches all of your needs and does not leave you open to any risk.
4. Decide on a Reasonable Deductible
You will be responsible for covering your deductible, or the amount you must pay if someone files a claim on your company. Avoid opting for higher deductibles because of tempting low premiums. Instead, set yourself up for a reasonable deductible that you know you will be able to afford if the time comes.
5. Overestimate Your Insurance Needs
Choose a policy that fully protects your business, even if it is slightly above your needs. Overestimating your needs can save you from financial strain, as expenses from a lawsuit can add up fast. Protect yourself with a little extra padding in order to potentially save your business thousands of dollars in the long run.
When researching your business coverage needs, contact Absolute Insurance Agency in Foley, AL. The agency offers over 20 years of experience in everything from personal to commercial insurance packages. Visit their website to learn how they can help protect your business, or call (251) 942-6837 to talk with a representative.