Reasons that may lead to a decrease in profits or even to the closure of the company:
- inflation, tax law changes
- the introduction of laws restricting activities or imposing additional costs
- destabilization of the economic situation in the country - this can significantly undermine demand
- loss of key specialists
- human factor (employee error)
- force majeure: fires, accidents, natural disasters
It is impossible to predict the onset of global crisis situations, but it is in your power to minimize the damage from the above factors. What types of business insurance exist.
Types of Small Business Insurance for Your Business
What is offered?
A package designed for small businesses usually consists of 3 main types of insurance:
The amount of insurance must correspond to the true price of the insured property. Otherwise, the company-insurer has the full right to compensate you only a fraction of the damage.
- property insurance
- liability Insurance
- industrial break insurance
You open a company and, most likely, rent an office or buy it, get furniture and office equipment. Not to mention the high-tech business, which requires expensive equipment. Your property, whether purchased or rented, may be damaged or stolen. Property insurance requires the insurer to pay the full amount of the damage.
Note that the amount of insurance must correspond to the true price of the insured property. Otherwise, according to the law, the company-insurer has the full right to pay you only a fraction of the damage. It is calculated by the ratio of the amount of insurance to the real price of your property.
How Does Small Business Health Insurance Work?
What gives the right to insure a property insurance contract?
Almost everything you can touch and is yours according to the law:
- buildings, extensions, warehouses
- goods and material values
- money in cash or in a safe
- industrial equipment, office equipment
- furnishings and all interior decoration
The cost of insurance is always calculated individually. It, as a rule, depends on many factors.
Here, the type of property, the deductible used, the set of risks, the installment plan for payment will have a great impact.
This type of insurance will help if your company has caused harm to the customer or he has a claim to your goods or services.
Suppose you own a beauty salon. Your employee, using professional cosmetics (and this is a chemical!), Has damaged the visitor's health. Or the master barber has dried the client's hair.
If the victim makes a claim to the salon, and you do not have the opportunity to pay damages, you can use the liability insurance contract. It is important that the insurance company in this case will compensate the damage only within the amount of insurance.
Occupational Interruption Insurance
There may be interruptions in your production. Scheduled - holidays, employee leave - can be foreseen. But unplanned, caused by force majeure, are a threat.
For example, in the office fire. Small, but paralyzing for some time the activities of the company. Forced downtime will result in losses:
- lost profits
- unplanned expenses for damages
- current costs of renting premises, taxes, staff salaries, etc
There may be interruptions in your production. Unplanned, caused by force majeure, are a threat.
The actual downtime will determine the amount of damage that the insurance company undertakes to pay. However, the company-insurer in the contract establishes a franchise, indicating the minimum downtime in the activities of the enterprise. It turns out that part of the loss is not returned.
Suppose the deductible is 5 days. If the company's activity is restored during this time, you will not receive anything from the insurer - here, a period of 6 days falls under the insured event.