Insurance Risks for Small Businesses

05 November 2012

Small businesses must take every step possible to reduce risk. A mistake, a forgotten step, or even a defective product can have serious financial consequences to a business and its future. The cost of litigation is incredible, even in small instances. What can a business owner do to protect his or her passion and employment?

Robust Business Insurance Protects

The most important step a business owner can take is to have the right types of policies as well as the most robust policy level possible. Anything else puts the organization at risk. To minimize risks associated with litigation in these situations, adequate insurance protection is necessary.

Public Liability Protection

One option is the use of public liability insurance. It provides protection in instances where an individual is injured because of your business’s operations, you, or your employee’s actions. This type of protection provides coverage of any legal fees, damages and other expenses related from the claim of the injured party. What could happen?

  • An item may fall from a shelf onto a customer.
  • A product may have a defect.
  • An employee’s mistake with paperwork or educating the customer can result in customer error or injury.

The risks are numerous. Public liability insurance protects the business from such instances.

Employer Liability

Another type of insurance protect necessary for business owners to have is employers liability. It provides employers with protection in instances in which employees are injured on the job. This is a legally required form of insurance protection for most businesses.

Other Insurance Needs

  • What else does a business owner need? Consider the following:
  • Property insurance provides protection for assets the business owns from losses and damage. Such instances as fire or theft could leave a business inoperable.
  • Professional indemnity insurance provides protection for professionals whose decisions could lead to a poor result. Individuals such as accountants, lawyers, doctors, and even computer consultants should have this protection.

Specialized insurance for your product and service needs, as they relate to your business, are critical to maintain.


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