One of the most common mistakes that new and inexperienced small business owners make is opening their doors without sufficient insurance coverage, or any for that matter. As a result, their budget absorbs the full brunt in the event of a financial calamity. Regardless of your business’ industry and focus, its products and services, and strategies employed, you’ll need insurance to protect your brainchild as it goes public.
1. It’s the Law
According to the Small Business Administration, businesses with employees must carry a certain level of insurance including worker’s compensation, unemployment, and disability, more or less be depending on the state where your business is registered. Failure to comply with this law can lead to substantial fines, civil or criminal charges, and even a “cease and desist” order.
2. Lawsuits are Just Around the Corner
The current society we live in is a litigious one. In the unfortunate circumstance that your business is threatened with a lawsuit or liability charge, your business could either buckle and land back on its feet or collapse entirely. It all depends on whether or not you have insurance. Remember, it only takes one accident, one contract not honored, or one disgruntled employee to ruin your business’ finances.
3. Keep Your Business Operational
Imagine what would happen to your business in the event of a fire, flood, or riot that causes storefront damages amounting to thousands of dollars, and you had no insurance to cover it? Per Upside Insurance (http://www.upsideinsurancegreenville.com/), having full insurance coverage protects you from property damages and makes sure that your assets including building, equipment, and inventory can be replaced as soon as possible to get your business up and running with minimal losses.
4. Insurance Makes You Look Credible
Having business insurance makes you more legitimate in the eyes of customers and potential investors. It shows that you are a safe bet and that you’ll likely be around for the years to come. Not having insurance communicates the opposite to the public as it could lead to financial insolvency in just one bad turn of the wheel. That is the whole reason why businesses feature statements, such as “Licensed, Bonded, and Insured,” in their marketing content.
5. Safeguards Employees
Your employees are your most important asset. You’ll want to protect them in the event of an injury that transpires in the workplace. The law requires companies to have worker’s comp on their insurance plan. And while disability coverage is optional, you should consider adding it to your policy even if you need to offset some of the expenses to your employees. Carrying insurance that covers their health and well-being can also give your workforce some confidence and morale boost.
Whether it’s a disgruntled employee causing your customer’s bodily harm or a freak accident that leads to property damages of the building next door, you’ll want to have a financial safety net to cushion the blow. Now that you know all of the reasons to get insurance, the next step is actually finding one that suits your business’ needs and circumstances.