Business insurance frequently appears more complicated than personal insurance policies. New business owners may find it difficult to comprehend the business insurance market and the available options. Read on to learn about some of the most widespread myths concerning business insurance and the truth behind them.
Myth 1: You don’t need business insurance for a small business
Your risk exposure should be the basis for your insurance plans. It’s not about how much money you make, how many people work for you, or how big your shop is. Risk can take many different forms. Theft of company property, a fire that destroys your inventory and business premises, or even a client suing you because they were unhappy with your product, service, or advice are all business risks. Simply put, the right business insurance ensures that you won’t go bankrupt in the event of a catastrophe.
Myth 2: Home-based businesses do not need insurance
Although both home and business insurance can cover the same types of risks (liability, theft, damage, etc.), the premiums are calculated very differently. An insurance provider will always view your home and business as independent entities. Compared to homes, businesses are exposed to significantly more risk, therefore the two types of insurance are conceived very differently. The lack of coverage or limited coverage when filing a business claim under your home insurance policy can often come as a rude surprise.
Myth 3: A basic policy is enough
Most individuals assume that when they see the word “general insurance” they are obtaining all-encompassing security against any potential threat to their business. However, general liability insurance only addresses a portion of the dangers that could harm your company. This may be the case for a small number of business owners.
However, each business is different; some may use incredibly expensive inventory or equipment, and others may deal with sensitive information. It’s crucial that you discuss the best strategies to close the gaps with an independent insurance company.
Myth 4: Auto insurance is not required if you or your employees own a vehicle
Whether you have one or more vehicles set aside specifically for business use or not, if you or any of your workers need to drive to conduct business, you must have auto insurance coverage. Your personal auto insurance coverage might cover claims that occurred during your commute or lunch break, but you’ll need a commercial auto insurance policy for mishaps that happen while you’re driving for work (making deliveries, going to a job site, etc.). Your personal auto insurance coverage is NOT a substitute for commercial auto insurance.
Myth 5: Business insurance is extremely expensive
While business insurance is not free, it can very well be affordable. It is also important to consider its impact on your business, particularly a small business. It protects you against several risks including damage to your business property or a litigious client. It also helps pay for pricey renovations, repairs, and legal fees. With business insurance, you can pursue your passion without worrying if you have a comprehensive insurance policy that gives you comfort.
Choosing the right business insurance is easy with J. Archer Insurance
Operating a business takes a lot of hard work. As such it deserves to be protected. An annual review is the best way to ensure that your business is fully protected from any type of financial loss. Contact the agents at J. Archer Insurance Group if you have questions about how you can make the most out of your business insurance.