As a financial planner, you have a bevy of important responsibilities. You are in charge of managing cash flow for individuals, helping them get out of debt, preparing for education expenses, retirement planning, investment planning and tax or succession planning, just to name a few of the important functions you handle. As expected, this means your biggest risks are related to the business you do and the associated liabilities. Additionally, you are at risk for property damage, general liabilities and basic business risks. Protect all of your risks by choosing the right types of financial planner insurance.
Types of Financial Planner Insurance
To properly insure your financial planner business, you need insurance to cover each of your risks. The following policies are the most important ones to consider:
General liability insurance is a basic business insurance policy that includes coverage for premises liability, product liability and completed operations. For a financial planners business, premises liability is another concern. That way, if a client visits your place of business and gets into an accident on your premises, their medical costs and any legal costs are covered by the insurance policy.
Professional liability, also known as errors and omissions, is one of the most important policies to have as a financial planner. This protects you from legal claims if the work you do causes damage to your client. Any small mistake could mean serious financial consequences for the client to which you are responsible. If this happens and you’re sued for damages, professional liability financial planner insurance covers the majority of these costs.
It may seem like auto accidents are a low risk as a financial planner, but you need business auto insurance any time you run a business errand or travel to visit a client. These are considered business trips and need to be covered by a business auto insurance policy. That way if you get into a collision, any bodily injury or property damage is covered by the policy.
Your business property is essential to conducting business on a daily basis. An unexpected event like a fire, extreme weather, or natural disaster, could destroy the property and contents. This means going without an office for an extended period of time. The best way to protect your business against the costs of catastrophes is by getting a business property insurance policy. This type of policy offers assistance with replacing what was destroyed, such as filing cabinets, furniture and books, and making necessary repairs.
If you have an online website where you advertise or sell your services, you should also be protected by cyber liability insurance. It is more than plausible that an experienced hacker conducts fraudulent activity — like stealing your personal information and causing a virus on your website. This damages you and anyone who visits your site. With cyber liability insurance, any damages or legal costs are covered by the policy.
Workers’ compensation is a type of insurance that is mostly to protect your employees, but provides your business protection as well. If you run a financial planning business, your employees should always be covered by workers’ comp. This allows for medical costs to be covered if they get injured while performing work functions. An employee could trip over a stack of filing boxes and brake their ankle or develop carpal tunnel from repetitive data entry work. These instances are considered work-related and therefore covered by workers’ comp.
Financial Planner Crime Insurance
The last type of insurance policy you should consider for your financial planning business is crime insurance. This offers protection if a crime occurs, such as fraud, theft or vandalism of your business property. Even with proper security measures, you run the risk of a crime occurring. With crime insurance, you don’t suffer financially.
Now that you know of the most essential insurance policies, you can run a successful financial planning business without worrying about your risks. If an unexpected event occurs, you will be protected thanks to financial planner insurance.