The business world is a scary place even for those who are experienced entrepreneurs. Being a new kid on the block is much scarier, which is why you need all the protection, reassurance and guarantee that you can get. The simplest way to achieve this is to get proper insurance, yet, how are you supposed to know all there is on this topic when you’re not even sure what awaits you out there in the open market. The most reliable way for you to get prepared is to learn from those who have threaded on this path before you. Here are five insurance tips that new entrepreneurs and startup owners need the most.
1. The cost of the policy
The first thing you need to understand is that no matter what kind of insurance you intend to get; the cost of the policy is definitely not a fixed thing. In some scenarios, it’s affected by your credit score (not just for car insurance but for other types of property insurance, as well). Even if the company that you’re currently negotiating with refuses to budge on their offer, there are many other organizations to inquire with. In fact, you can use the fact that you’ve already talked to someone else as leverage or a persuasion technique. You’re an entrepreneur now so start thinking and acting as one.
2. Asset insurance
Once you get past this, you need to understand all the different types of insurance that you’ll have to get for your business and, in order to make things somewhat more clear, we’ve decided to split them into several categories. First comes the asset insurance, which is supposed to cover the property that you’re working from, the machinery that you’re using to generate profit, insurance for corporate vehicles and more. Also, aside from vehicle insurance, you must also realize that there’s a real threat for the goods to be damaged while traveling from location A to a location B. Therefore, what you need is to get insurance for the goods in transit.
If you’re running a home-based startup, which is more and more common occurrence nowadays, you also need to consider the importance of getting home insurance. For this to work, you’ll need a home office, as well as a policy that can cover all the assets necessary to run your home-based business. Overall, this is just one more item on your already long list of asset insurance types worth considering.
3. Employment liability insurance
One of the most important things that you have to tend to, as an entrepreneur, is to consider the employers’ liability insurance, which protects you against the cost of various compensation claims. You see, accidents are known to happen even in the safest of work environments, which could result in a fine. For a relatively new enterprise or a startup, considering all the options and variables is a must, seeing as how, otherwise, a single claim could take you back considerably. This is why you should even pay considerations to specific scenarios like ones involving TPD mental health claims and insurance policies that you’ll have to get in order to properly prepare for them.
4. Commercial and product liability insurance
While you may have all the best intentions to provide your clients and customers with the project they want, need and deserve, things might not always work out for the best. When this happens, you stand to lose more than their trust, seeing as how you may be legally responsible for a failure to deliver on what was promised. While a reputation hit may not be avoided in this particular scenario, what you can do is insulate your business from a financial standpoint by getting commercial general liability insurance and product liability insurance. This way, you’ll prepare yourself for the worst outcome.
5. Business interruption insurance
One of the things that people often forget to consider is business interruption insurance. This is something that may come in handy when the unforeseen occurrences make you start losing income due to the inability to finish a project or work on it, to begin with. For this, on the other hand, you need to be quite specific when stating the length of time that the insurance should cover. Needless to say, this is something that will be actively used in the premium calculation.
The thing about insurance is the fact that you’re paying for all these services that you hope you’ll never need. In order to feel better, and keep yourself motivated, you need to govern yourself according to the principle known as Murphy’s law – if something can go wrong it probably will. No, this doesn’t mean that you should be a skeptic or a pessimist, it just means that you shouldn’t allow anything to catch you off guard.