Many small business owners have a lot to consider in the course of their day-to-day operations and this is particularly true for those looking to expand their companies going forward. However, before doing so, it may be vital to assess the needs these enterprises have as it relates to their various types of insurance coverage.
For many small business owners, insurance might be a relatively small part of their daily considerations, but those who are looking to expand may face particular challenges associated with these costs, according to a report from the Huffington Post. For instance, while there are some insurance needs even for the smallest companies, operating out of an owner’s home, those that plan to move into new office spaces may want to consider the many different types of policy costs they might end up facing for the first time.
For instance, in many cases, the landlord of an office space will require small business owners to buy general liability insurance, and many larger firms for which some small businesses work require these policies to be rather sizable before entering into such an agreement, the report said. Likewise, those companies that are providing advice to their clients, or consulting, it may be wise to have errors and omission insurance policies backing up their work.
And with all these considerations existing, it’s often vital for small business owners to determine exactly how much insurance they need, and what kinds, before they make any major decisions about expanding their operations, the report said. Not doing so can create massive financial or legal liabilities that would be difficult for companies of nearly any size to deal with, let alone those with just a few employees and narrow profit margins.
What owners need to keep in mind
One thing that many small business owners might not know is that not all insurance providers offer the kinds of coverage that their companies might need as they expand their operations, the report said. However, they will typically be able to refer companies to other insurance providers that will help them find all the right coverage they need.
Of course, finding out exactly which insurance will be necessary for owners to keep their companies as free of liabilities as possible isn’t always easy, but using common sense and examining all available options may help to point them in the right direction, the report said. For example, if the company has vehicles it owns, and which are operated by employees, it will likely be necessary to have commercial auto insurance, and again, coverage like general liability and errors and omissions insurance will generally help to protect businesses in their daily operations.
Moreover, companies with any number of employees are required by law to have workers’ compensation insurance policies, though the cost for this type of coverage will vary from one state to the next, the report said. Nonetheless, it may be wise to shop around, particularly as costs for this type of insurance have risen somewhat nationwide over the past few years.
Finally, for companies that handle any amount of sensitive customer or client data, it might be wise to look into the types of coverage tech insurance can provide, as this will help to protect them in the event of a data breach. These types of incidents, which can be caused by any number of things, are becoming increasingly common these days.
The most important aspect of tackling small business insurance needs is making sure the company can afford all the policies it might require, and assessing just how much can be handled at any one time.