Running a small business comes with multiple risks and can be easily solved with the right business insurance. It doesn’t matter if it’s just you and a handful of clients or a larger firm with staff and work rolling in the door, the risks are still there. But so are the rewards, the freedom that comes with being your own boss and a realm of opportunities. All the perks of running your own business mean nothing though, if you haven’t taken the proper precautions to keep your hard work protected from the get-go.
As a small business owner, we spend endless hours strategically planning everything. Our funds go into eye-catching marketing materials and building a brand that fits the business and audience perfectly. The fun stuff! Of course, we weigh up the financial risks too. But when it comes to business insurance, it’s very easy to put off essential cover until we have more room in the budget or the business expands. Every day, small business owners are exposing themselves, their families and their staff to the impact of illness and injury through the lack of business insurance coverage. Don’t put yourself at risk! Here are the top insurance dangers to avoid:
1. Skimping on Business Insurance Specialised Services
Running a small business is time-consuming. If you want to streamline things, free up valuable time and focus on what you’re great at, it’s important to know when and what to delegate. Engaging with specialised services, like a corporate insurance broker, can cut the stress and time it takes to find the right insurance for your business in half. They take the guesswork out and are better equipped to identifying exactly what insurance is the best fit for your needs.
Without the expertise and knowledge that comes with insurance brokers, it’s very easy to fall into insurance traps or invest in a policy that isn’t the best fit. This can cost more money or have you locked into a cover that doesn’t protect you from everything you need it to. Brokers are qualified to deal with the insurance company on your behalf, so you don’t have too. They represent you – and your best interests and work to find the best comparison and results to save you the headache. Insurance brokers can help to manage any claims so all information is in order without you having to fumble around for it.
2. Not Investing in the Right Insurance Policies
Investing in an insurance cover that’s aligned perfectly with your business needs is a priority. It seems like an obvious point, but dissecting the industry jargon and understanding the inclusions/exclusions can take a lot of work – and this is where an insurance broker can help. To eliminate the risks involved with running a business, you need to be aware of what insurance covers are compulsory in your location. In Australia, worker’s compensation is required to protect your staff.
Other insurance policies to consider for your small business needs may include:
- Business Interruption Insurance: Covers for any interruptions as a result of damage to the office premises.
- Liability Insurance: Protects against perceived mistakes when delivering a service.
- Income Protection: Covers a percentage of your income for living and medical expenses.
- Cyber Insurance: Protects your business against a cyber-attack, which can result in the loss of important records and funds.
3. Believing Your Small Business is Safe
Every business comes with risks. Even if you’re just setting up in a home office liaising with clients from your laptop or the local café, it’s still vital to keep the empire you’re building protected. Small business owners must have a risk management strategy in place to help identify the specific dangers. A financial contingency plan will help you map out ways to maintain financial independence should the worst happen. This isn’t just essential in protecting you, but also your family and assets if you’re no longer able to work.
No matter the size of your business, you need business insurance. Many small business owners believe their business is safe because it’s too small. But the basics, like liability coverage at a minimum, is necessary. No business is too small to be involved in a costly lawsuit!
4. Forgetting to Adapt Your Business Insurance Cover as Circumstances Change
A big insurance pitfall is failing to review your cover on a regular basis. Once you have identified your risks, engaged with an insurance broker and invested in the right policy, you need to stay on top of it. As your business grows, your insurance needs may change. Premiums can go up, so review your cover on a yearly basis to confirm you always have adequate coverage. This will help to identify ways to save on your insurance cover too.
Insurance is one of those things that small business owners least like to talk about, but it’s high on the list of must-haves. You have worked hard to build a fantastic brand and poured your blood, sweat and tears into creating your own future – make sure you keep it that way by reducing your business risks.