business insurance

Business Insurance – Types, Benefits And Coverage

By November 15, 2020 No Comments

Guard & Protect your Business

You are a business owner and you have a great deal to protect and build. Working on making your business successful requires you manage many variables including finding & retaining customers, managing supply of products / services, managing employees, ensuring quality, managing cashflows and compliances and this takes a lot of effort. Most business owners just don’t get the right advice on making their business successful by managing their risks which can be insured. The right way to protect all this for present and in future is to get the right business insurance. This ensures a great deal of business continuity and success  which in turn makes sure that your legacy will get continued to be built upon. There are a variety of coverages to choose from when it comes to protecting your business.

These can be classified into :-

  1. Package Policies – Much like an office package policy. This will cover your office assets, liabilities from third parties and internal stakeholders apart from covering your employees.
  2. Specific Risk Policies – These include stand alone fire insurance polices, specific trust covers etc.
  3. Customised Policies – When you have a peculiar risk to be covered, these policies can be customised according to your unique requirements of the business to be insured.

Which insurance works best for your business is a relative function of a few factors including the size and complexity of your business and its risks, your capacity to pay premiums associated with those insurance policies and your risk aversion to many of the factors that can impact you. Many times your customers may insist on your taking specific covers that ensure their risk in dealing with your products and services is mitigated.

The most obvious reason to purchase small business insurance is to protect your tangible investment arising out of cash spent and time invested. From your raw materials and semi-finished / finished goods, to the tools you use to make your business do magic ( plant & machinery, furniture & fixtures, Laptops, Mobiles & other IT equipment ) and right up to the workmanship and quality of your products and services.

What would be the resulting impact of, for example, a fire destroying your place of business, making your equipment unusable and your products unsellable? Another example would be a customer suing you for financial loss arising out of using of your products or implementation done by you or on your advice.

What Is Business Insurance?

The term “business insurance” includes all the different types of coverages available to protect business owners from losses. Through business insurance india, you can cover your property, insure your raw materials / semi finished or finished goods in the factory or warehouse / godown, insurance against transit risk while goods / products are being procured or sent to customers.

You also get coverage to for legal claims against the business such as Third Party Liability, Workmen Compensation Act, 1923 ( Renamed as Employees Compensation Act, 2011 ), cover under under Public Liability Act 1991 and also provide health insurance for your employees.

Why Do I Need Business Insurance?

Success in your business is not only about increasing your chances of success. It is equally about reducing your chances of failure. There are always far too many risks and potential threats to its successful and continued operation; A thorough evaluation and being present to your risks along with tailored business insurance policies can help protect you and your venture to a great deal. And it will give you peace of mind.

Fires and accidents happen, earthquakes & floods are becoming common, burglary & theft is rampant and so are chances of lawless people doing malicious & intentional damage to your property. People slip, fall, get sick, and even die. And all of these things can occur in your business. This is why all businesses, whether they are one-person operations or large businesses, need insurance. No one ear thought that there ever would be a risk of businesses shutting down, downsizing or getting impacted globally due to an event. Yet Covid happened and proved everyone otherwise.

What Types of Business Insurance Policy Are Available?

The main types of business insurance you should consider include:

  • Property and Casualty Insurance: Property insurance provides coverage for the physical location of your business (rented or owned) and its contents from perils like fire, theft, flood, and earthquakes.
  • Marine / Transit Insurance: This covers  potential loss or damage to goods while being transported from one location to the other by rail, road, air or by sea.
  • Health Insurance: Health insurance provides health coverage for you and your employees. Group health Insurance policy or Group Mediclaim as it is often called provides excellent coverage for this. These canoe tailor made to suit your requirements and capacity to pay premiums. 
  • Life and Disability Insurance: Life and disability insurance covers your business in the event of the death or disability. These are typically group life insurance and group accidental insurance covers.
  • Workers’ Compensation Insurance If you have employees, by law they are protected against death or disability during the course of performing their duties ( per Workmen Compensation Act, 1923 and amended as Employees Compensation Act, 2011 ).
  • General Liability Insurance: Liability insurance covers you in the event someone sues you for negligence, which can occur, for instance, if someone falls on your property or has an accident that causing injury.
  • Product Liability Insurance: Product liability insurance covers your business for damages caused by a product designed, supplied, or manufactured by your business.

Can I Get a Policy that Combines Different Types of Insurance?

Yes. A Compact Package Policy, often appropriate for small to medium-sized businesses, usually includes property, casualty, liability, and employee insurance cover. Its likely that he cost in this bundled package gives you an advantage as compared to buying each cover individually.

How Do I Buy Business Insurance?

Much like you go to a Lawyer for getting legal contract made and checked, a Doctor when you need medical advice, an Insurance Broker is best suited to help you procure the right insurance coverage. Unlike an individual agent who can only provide insurance from a single insurer or directly buying from an insurance company, when you buy from an Insurance Broker, you get an advantage of knowing the best covers available for your business.

Another important reason is that the broker will also support your interests at the time of a claim which otherwise you may end up handing yourself with limited knowledge. Their experience and expertise is best suited to represent you in this highly technical domain. 

As a broker, we help you in making an informed decision about choosing a cover knowing exactly what your business is and associated risks are. We then present to you the types of coverage we think might be helpful in your business for various risks and help you in finalizing a policy and insurance company after discovering the options available with the insurance markets. The final decision is always yours. 

Choose an insurance broker who is licensed and has a record of helping businesses like yours get the best options – coverages / fine prints and premiums, and make sure they understand your type of business and the risks it incurs. 

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