Insurance is often the last thing a small business owner has time to worry about. But if reducing financial risk and improving business stability is important, you can't afford not to think about it, say advisors in this field. Without insurance there would be considerable impact on your business if you do suffer a loss. A little research and a conversation with your broker may save headaches later. As a start, the leading business insurer, RSA, offers small and mid-sized business owners these five tips:
1. Commercial General Liability: Make sure you consider what amount of liability coverage you need for both your business and your operations. If, for example, a customer suffers a serious injury on your property and sues, and you don't have enough coverage, you could end up paying out of pocket. This could result in a significant financial loss and risk to your business.
2. Business Interruption: This coverage is designed to provide protection for loss of earnings and necessary continuing operating expenses following material damages from events such as a fire or water damage from a pipe burst. In other words, it will provide you with support when your business is temporarily unable to operate as it normally does.
3. Income Replacement Benefit: In automobile policies look under the optional accident benefits coveragein Ontario. This coverage is meant to supplement your income when you are unable to perform essential tasks required on the job. Depending on whether you have access to an employee benefit plan, you can purchase up to a limit $1,000 per week to support yourself should you be injured in an accident. You'll want to talk to your broker to determine if this coverage is right for you, and how it fits with other policies or benefits plans that may be available to you.
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4. Loss Control Benefits: Protecting your property can benefit you in many ways. For example, if you install an alarm system, you may prevent or significantly reduce the financial impact of a fire or burglary. Installing an alarm may also reduce the cost of your insurance with qualification for an alarm discount – this discount may offset the cost of installation.
5. OPCF 43 – Removing Depreciation Deduction: This add-on to your automobile policy covers the depreciation of a new private passenger vehicle when you are the original purchaser/lessee. If your two-year-old vehicle is a write-off as the result of an accident, you'll be reimbursed for the non-depreciated value of your car. This will help reduce the financial impact to you if there is a significant difference between the amount owed on a vehicle and the actual cash value, which can leave you short.
-- News Canada