Small Business Tips
Insurance is essential in your financial plan
(NC)-No matter what the size of your business, insurance should be a key part of your overall business financial plan. Every business has to protect its assets, including vehicles, equipment, inventory, employees and partners. Insurance can protect your business by providing funds to meet financial obligations if certain losses occur, including illness, disability or death of a key staff member, travel emergencies, customer defaults, property damage, theft or litigation.
"Business insurance needs are much more complex than that of insuring your car," states Paul MacDonald, senior vice president, Aon. "It's important to look for a package that is personalized to meet the needs of your business."
Many businesspeople misunderstand their current insurance policies. For instance, if you operate a home-based business, your home-owners policy does not extend to protect your business. It is critical to protect your business with specific commercial property and casualty insurance.
Another type of insurance every business should have is liability insurance. Litigation is becoming more common in disputes, making liability insurance vital to protect your organization and employees from lawsuits.
Common types of business insurance
Commercial property insurance provides coverage for physical items that are owned by the insured such as commercial buildings and inventory.
Commercial casualty insurance is a third party coverage responding to bodily injury, property damage or personal injury.
Commercial general liability covers injury or property damage caused by you to others. It provides coverage for these exposures subject to certain exclusions that limit what is being insured.
Business interruption policies assist businesses facing lost profits and ongoing expenses due to a property loss. Contingent business interruption insurance can protect you if you face a loss of revenue due to a major customer or supplier suffering an insured property loss.
Auto liability offers coverage for your organization's legal liability for bodily injury and for damage to the property of others in a car accident.
Directors' and Officers' liability insurance (D&O) protects directors and officers against liabilities they may incur in carrying out their corporate duties and functions in managing the affairs of the corporation. A D&O policy provides coverage for defence costs, judgments and settlements, and can include investigatory expenses.
These are only a few of the more commonly recommended insurance products for businesses. You should discuss your specific needs with an insurance professional.
More on small business insurance can be found online at www.aon.com.
- News Canada