Every business owner needs some form of insurance. Think of insurance policies as safety nets that you can land on if you slip off the business ladder. There’s a lot that can go wrong when running your company and the recovery could cost you a fortune. Everything from theft to a lawsuit is a possibility that you may need to consider. With the right insurance policy in place, you can soften the blow of any financial issue.
You also need to understand that some forms of insurance are not optional. Small businesses are legally required to have certain insurance policies in place to protect the business, their employees, and the general public. Here are some of the insurance policies that you need to have in place before your new company opens on the market.
General liability protects you if your business injures another individual or causes damage to property. With general liability, you can make sure you are covered with a defense and if you need to pay damages. As such, it is crucial for any and all business owners, whether working from home, a factory or in an office. There are lots of instances where general liability insurance could come into play. For instance, a member of the general public might be injured on your property due to tripping over a wire in your office. If this occurs, the insurance may help you pay for any legal costs or compensation.
Excluding Texas, all states require business owners to have workers compensation insurance in place if they have more than five employees. This form of insurance provides compensation to workers who are injured on the job, at work, usually on the property. In some states, it is possible for workers to claim on injuries that they suffered from while away from the business property within business hours. The insurance can be used for anything from paying medical bills to covering lost wages. By having worker’s compensation, business owners can avoid the possibility of injured employees suing for damages due to an injury. Penalties for not having the right workers compensation in place are costly and should be avoided.
Any business that offers services to clients or customers will need to consider getting professional liability insurance. This protects a company in the event of errors or negligence while offering a service. For instance, doctors have this insurance to in case they are sued for malpractice. It is useful for a wide range of companies from hair salons to law firms.
Product liability relates specifically to products being sold by your business. If you sell products, this will protect you if the product in question is argued to be defective or causes injury to customers. For instance, in the past, there have been toy firms that have been sued for using lead paint on their products. With product liability, these firms were able to avoid expensive legal costs.
Business owners often hold a lot of sensitive data about clients and customers. Usually, if a hack does occur in your business, customers will be the targets rather than your company. As such, it is important to protect yourself from the cost of losing sensitive data. With data breach insurance you will be covered for any legal damages related to this issue. It is important to realize that this insurance protects a business whether the data was lost electronically or through a paper file.
Property insurance will protect your business from any damage to your property or any items inside it. For instance, it ensures that you are covered if computer hardware is stolen from your office. Or, if a fire destroys part of your building. It is also possible to increase the insurance policy to ensure that loss of earnings are protected if your business is not able to function due to the damage that has occurred.
Commercial Auto Insurance
You might want to think about personal automobile insurance if you are using a fleet of vehicles for your company. This is going to be particularly important for any business that has transportation as a major part of their business model. For instance, a logistics business owner should make this insurance a top priority. It protects you from bodily injury, physical damage and liability in the event of an accident on the road involving a car your company owns.
If you are running your business from home, homeowner’s insurance is going to come into play. This will protect you from the loss or damage of any property in your home. It can also ensure that you are covered if any injury occurs in your home or an accident that you may have caused.
Renters insurance is specifically for business owners who are renting their home or their property. Similar to homeowner’s insurance it protects the renter in the event or property damage, a personal injury or damage to the property itself.
It’s possible that your business is going to have the potential to make you a lot of money in the future. If you passed away, you would want to make sure that your loved ones still benefited from the potential earnings of your company. With a life insurance policy, the insurance company pays out a certain amount of money to your beneficiaries. This amount is based on how much you would have expected to make if you had lived a full life. As such, it can give new business owners peace of mind and guarantee that the potential for their business earnings are protected.
Personal Umbrella Insurance
Finally, you should consider looking into personal umbrella insurance. This gives you an extra level of protection from legal claims, property damage and any other financial loss that you might incur. Often, this form of insurance is sought out when all other forms of coverage have been used. As such, it is commonly used by larger corporates and bigger businesses. You probably won’t need it straight out of the gate.
The Importance of Cargo Insurance for International Shipping
SMEs (small-medium enterprises) know they need to expand beyond their shores to compete with the big brands in their sector, and this is where international shipping bridges the gap for them. Shipping and using freight forwarders has enabled SMEs to connect with new markets offshore and grow a more extensive customer base.
Partnering with international freight forwarders as made it easier for SMEs to grow their revenue, secure competitive shipping rates, and use the same resources once only afforded to big businesses. With better purchasing power, these smaller enterprises can compete and gain market share offshore.
Therefore the first step to taking your business global is to establish a mutually beneficial working relationship with a reputable international freight forwarder. The provider’s specialized knowledge regarding international customs, shipping costs, and trade routes are at your disposal.
For example, a freight forwarder will calculate shipping costs to specific trade routes across the globe. The cost of shipping to Germany, China, the USA, or any other trade hub can be negotiated with the right shipping partner, and this insight can provide SMEs considerable cost savings.
However, risk of damage or loss is unavoidable, and accidents do occur. Loss and, or damage to cargo during transport can be devastating and costly, so to counterbalance the risks associated with cargo shipping, customers (businesses) are encouraged to take out cargo insurance.
Understanding Cargo Insurance
Cargo insurance is a necessary preventative measure in today’s globalized market. With customers’ expectations at an all-time high, cargo insurance provides SMEs with financial security, if goods are damaged, lost, or stolen during transit.
Insurance coverage varies according to the type of policy. While every shipping carrier provides insurance, the scope of this coverage varies; therefore businesses are advised to buy additional coverage to ensure their goods are secured with a comprehensive insurance plan.
Types of Insurance Coverage
The all-risk policy is one of the broadest types of insurance coverage available. As the name implies, an all-risk policy offers protection from any physical loss or damage incurred during transit, unless the loss is specifically excluded.
Common exclusions associated with an all-risk policy include:
- Inherent vice
- Damage to cargo as a result of negligence
- Improper stowage by shipowners
- Customs rejection
- Cargo abandonment
- War, strikes, riots, and civil commotions (WSRCC)
- Loss of use/market
- Loss over the policy limit
- Employee dishonesty
- Failure to pay/collect
Also referred to ask “free of particular average,” the named perils policy only provides coverage for particular perils listed in the policy.
Common types of losses that can be covered by the policy include vessel collision or sinking, bad weather, non-delivery, theft, and burning.
If a ship or its cargo sustains a loss or is damaged due to a voluntary sacrifice; to safeguard the whole from a common peril, a general average can be invoked, meaning all parties must proportionately share or contribute to the loss according to their cargo’s value.
While general averages claims are rare, SMEs consider getting coverage for this type of risk to avoid any liability if a general average claim is invoked.
Why Get Cargo Insurance?
There are several reasons why SMEs should opt-in for insurance beyond the carrier insurance. Potential hazards exist between your port of origin and the final destination. Ocean freight is particularly fraught with risk. Having a guarantee that goods are covered in the event of any loss or damage can put any business’s mind at ease.
Another considerable benefit is the avoidance of substantial financial losses. Cargo insurance protects from significant, uninsured losses which could compromise a company’s ability to fulfill orders and meet customers’ expectations.
Additional manufacturing costs, expedited freight charges, costs for other sales calls, and incremental criminal investigation costs are just some of the other expenditures a company faces should cargo be lost, damaged, or stolen during transit.
Insurance coverage reimburses you for any potential losses, minimizing its impact on your company’s profitability.
It’s also relatively easy to get insurance coverage. All freight forwarders provide insurance coverage and have carrier liability. What’s more, most insurance coverage policies can be customized according to the policy holder’s desired coverage and risk tolerance.
Get The Right Insurance Coverage
Appropriately insuring goods during transit starts with research. Companies must educate themselves on the type of insurance coverage available.
Different regions operate across different shipping lanes, which will demand specific insurance policies. Working with the right international freight forwarder will ensure SMEs have a strategic risk management policy in place to protect their shipments.
The value of the shipment will also play a critical role in determining the type of coverage required.
Companies must assess their risk tolerance and consider their shipment’s risk profile to estimate the impact of loss on their finances. SMEs should partner with an insurance professional to create a comprehensive coverage plan that covers end-to-end supply chain issues.
The Real Cost Of Cargo Loss
The health of any enterprise is determined by the perceived value of their goods and/or services. Interruptions to any supply chain can severely impact the company’s ability to conduct business and deliver its goods to its customers.
Whether it’s a delay in the arrival of goods or the loss and/or damage of goods, any interruptions during transit can adversely impact revenue and profit. A reduction in inventory can result in lost market share and severely damage the brand’s image.
Cargo shipping is a dynamic process. Multiple exposure points mean it is nearly impossible to predict transportation risk. The unpredictability of risk underscores the importance of purchasing cargo insurance.
By analyzing and understanding the types of risks that can impact their business, the owners’ can successfully develop best practices that mitigate any supply chain risks. In doing so, key risks are managed before they arise, protecting their company’s financial health and securing future growth.
Paul Rehmet is the Chief Product Officer for Shipa Freight. He is responsible for translating the company’s vision into an easy-to-use online freight platform for its customers. In his 25-year career, Paul has held various technology leadership positions with early-stage startups and Fortune 500 companies including Unisys, Destiny Web Solutions, and US Airways.
Dentists Need Income Protection
As a dentist, you spend your days taking care of patients and making sure their mouths are as healthy as they can be. During your time, you’ve seen it all, from patients who take really good care of their teeth to others who need a lot of work. You probably offer advice on how people should be taking care of themselves, as well as warn them of the risks if they don’t listen.
You may know a lot about teeth and oral health, but you may not be knowledgeable about dentist income protection. It is fine if you don’t know much about this beneficial insurance. There are professionals who can guide you through obtaining this policy for your practice.
Dentistry may not be a high-risk profession like being a police officer or construction worker, but having dentist income protection ensures that you will be taken care of if you get injured and are unable to work. You may not have a high risk of injury at your job, but your position has its share of physical demands.
Whether you are bending or craning to get a better look at your patient’s mouth, over time, this could lead to strain and/or injury. Not only that, but accidents could happen as well.
If you are questioning whether income protection is right for you, there are some reasons why you should consider getting it. Should a situation ever arise where you are unable to work, you’ll be thankful to have this policy in place.
Static Posturing Can Lead To Injury
Throughout your day, you may have to get up and move from one patient to the next, but for the vast majority of your working hours, you are hovering over your patients’ mouths. This static posturing can cause undue stress on your neck, shoulders, arms, and spine. Repeated stress and strain on these parts can lead to a variety of painful problems, including the development of cubital tunnel syndrome.
Should you find yourself in pain, this could have an impact on your ability to do your job. If things progress further, you may not be able to work at all. Make sure you are thinking about your long-term health and financial stability and put dentist income protection in place.
Your Hands Are Incredibly Important
You need your hands to perform a variety of specialized and delicate tasks. Whether you are extracting, polishing, or filling teeth, your hands need to be steady and agile. Like your body, your hands often find themselves in static positions. When that happens, it leads to an increase in potential problems, including carpal tunnel syndrome.
Numbness, tingling, and pain are all associated with this ailment, and if you are unable to feel your fingers or palms, you can’t perform your job. If you can’t work, you won’t have an income. However, if you have income protection in place, you’ll still be able to live comfortably and ensure that you are financially secure.
Finding the Right Protection
Your dental practice is unique, just like you, so you don’t want or need an income protection plan that is a one-size-fits-all. When you work with the right provider, they will be able to find a plan that fits your lifestyle and needs. Talk to a professional today and find the income protection plan that will work for you.
Life Insurance Jargon Buster
Researching life insurance is fraught with terminology you need to understand before you consider any type of policy.
In this article life insurance providers Reassured have demystified many of the key terms you’ll come across and we encourage you to reference this glossary as often as you need to so you’re fully informed before choosing this type of finance product.
Life insurance is a type of policy that pays out a cash lump sum to loved ones if the policyholder passes away during the term of the policy.
The policyholder will pay the insurer a monthly premium throughout the term to secure cover.
Level term life insurance
This type of life insurance policy will pay a fixed cash lump sum to loved ones if the policyholder passes away during a specified term length.
This type of life insurance policy will pay a cash lump sum to loved ones when the policyholder passes away during a specified term length, however the value of the sum assured (pay out sum) will decrease during the term.
Whole of life
A whole of life insurance policy provides protection for the whole of your life and guarantees to pay out a cash lump sum to loved ones when the policyholder passes away.
Over 50s life insurance
An over 50 life insurance policy, also known as an over 50s plan, that guarantees acceptance for people aged over 50 (and younger than 85) and offers a guaranteed pay out to your loved ones when you pass away.
This type of policy does not require applicants to disclose any medical information to the insurer.
Family income benefit
This type of policy provides your loved ones with a regular, fixed, tax free income for a set period of time after you pass away.
Joint life insurance
Also known as life insurance for couples, joint life insurance is when a term or whole of life policy is taken out for two people that covers them simultaneously.
The pay out is made upon the first death and the policy ends.
Critical illness cover
Critical illness cover (sometimes referred to as critical illness insurance) provides a tax-free lump sum pay out if you are diagnosed with a specified life-changing (but not terminal) illness, covered by your policy.
At Reassured, this can be taken out as an add on to a life insurance policy or as a standalone product.
Terminal illness cover
This type of cover usually comes as standard with any life insurance policy, at no additional cost.
It allows you to make an early claim on your policy if you’re diagnosed with a terminal illness and predicted to pass away within 12 months.
Impaired life insurance
An impaired risk applicant is identified by an insurer as a high-risk applicant who is more likely to make a claim on their life insurance policy.
Those who may be considered impaired may have pre-existing medical conditions, a dangerous job or hobby or have a particular lifestyle choice affecting their health, such as a smoker.
A prepaid funeral plan allows you to pay for and arrange your own funeral in advance, so your loved ones don’t have to.
You pay either by lump sum or by monthly payments to a funeral plan provider. You are able to secure the cost of a funeral today, avoiding the rising cost of funerals.
Life insurance policy
A policy is a legal contract between a policy holder and an insurance provider in which states the terms, conditions and details of the agreement.
The written name of the person in which the life insurance policy protects.
The guaranteed pay out amount from an insurance policy. The sum assured (or cover amount) is calculated at the beginning of the policy.
A sum paid monthly by the policyholder to remain covered by the life insurance policy.
A guaranteed premium remains fixed throughout the life insurance policy, (or until you pass away in the case of whole of life)
A reviewable premium is reviewed by the insurer at regular intervals and the rate can be increased.
The underwriter of a life insurance provider will calculate the cost of life insurance premiums by using statistical analysis and mathematical equations based on the information the applicant provides.
This means failing to provide the insurance company with all the correct information regarding your personal circumstances upon application.
If you do not make a full disclosure, then you may not be covered and your life insurance policy may not pay out.
When an applicant is guaranteed acceptance for a life insurance policy or a funeral plan, then they will not need to provide any medical information to secure this type cover.
Life assurance is a type of policy that pays out a cash lump sum to loved ones when you pass away, (not if). An example being an over 50s plan.
The policyholder will pay the insurer a monthly premium throughout the policy for the cover to be effective.
Guaranteed Insurability Option
Also known as a special events clause or policy increase option, a guaranteed insurability option is when the details of a life insurance policy are changed by the policy holder due to a change in their personal circumstances.
Reassured, amongst many other life insurance providers, are regulated by the Financial Conduct Authority.
The FCA was created by Parliament to regulate the conduct of financial services in the UK. The FCA ‘aim to make financial markets work well so that consumers get a fair deal’.
Waiting period (qualifying period)
An over 50s plan, or over 50s insurance, have a waiting period or qualifying period (typically 12 or 24 months) from the start date of the policy.
During this period of time, if the policy holder dies of natural causes then a pay out will not be issued. If the policy holder dies as a result of an accident, then their death will be covered by the policy.
A life insurance policy can be written in trust by the policy holder so that they have more control over how the proceeds are spent.
Upon their death, the trust is handed over to the trustee who takes care of the claim and manages the pay-out (on behalf of the beneficiaries) as per their wishes.
The beneficiary (or beneficiaries) of a life insurance policy written in trust is the individual who benefits from the pay out from the policy (and is nominated by the settlor).
The policy holder (owner) of the life insurance policy that is written in trust.
Any financial asset owned by the policy holder that passes away, such as their property.
The trusted individual (nominated by the settlor) who manages the policy once the policy holder passes away, including distributing the funds as per their wishes (on behalf of the beneficiaries)
Probate is the legal process of which confirms that your executors are in the position to administer your estate to your beneficiaries.
Probate does not need to be granted if a life insurance policy is written in trust (as it is not considered as part of the estate).
“Inheritance tax is a tax on the estate (the property, money and possessions) of someone who’s died”.
For an individual in the UK after your estate exceeds £325,000 you are taxed at 40%! Although this threshold may seem a lot, it includes you property, savings, possessions and proceeds from your life insurance.
Visit https://www.gov.uk/inheritance-tax for more information.
A will is written by someone before they pass away to determine what should happen to their estate after their death.
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