What’s Your Small Business’s Risk Profile?February 9, 2018
There are some risks that are inherent to any venture in life; lightning strikes, fires, even water breaks can happen anywhere and at any time. However, when it comes to finding the right small business insurance for your company, it’s easy to become confused about exactly what you should assess.
Before we get into your risk-assessment quiz, it’s important to note that you should be doing a risk assessment every year or so. A yearly checkup is prudent since changes can often happen to industry regulations as well as to your business itself. Here are 6 key questions that will get you on the right track to insure your small business:
First question: does your small business need insurance?
The quick answer to this question comes from answering this: “do I want to shell out my own money if something tragic happens?” No? Then, yes, you need insurance. But more to the point of asking is that your business might be in an industry that requires a specific insurance. You’ll want to be aware of any requirements you need to meet before choosing a plan.
Second: do you have employees?
After determining the regulations around your business, being an employer adds a huge amount of risk that you’ll want to have insured. Adding people—and all their own problems—to your small business can be a massive liability. Good employees far outweigh these liabilities, but you’ll want to have the proper insurance to make sure it stays good.
Third question: do you rent office or warehouse space?
If your small business rents property then you will need renter’s insurance or property insurance. But, depending on what kind of space you rent, you might need a specific kind of coverage.
Fourth: do you use vehicles for business?
Again, insuring your commercial vehicle takes commercial vehicle insurance—not your personal vehicle insurance. Make sure you insure each vehicle you use appropriately.
Fifth: does your small business work with delicate materials?
Whether volatile chemicals, medical products, or sensitive data, if your small business deals with items or materials that are delicate, you will need a specific insurance to properly cover your small business. Also, when it comes to data, you’ll want to look into cyber security insurance and digital protection.
Sixth: what else does your business do?
Did you move recently? Add equipment or employees? Does your small business bid on government projects? Do you have lots of travel? Getting the right profile of how your business does its business will help to fine-tune the coverage you get so that it perfectly fits your needs. These big 6 questions will help you target exactly what it is that you’ll need to insure.
I’ve got my small business risk profile, now what?
Once you have the risks sorted out, and you’ve been able to place a monetary value to each occurrence, your next step is to determine what insurance will and will not cover. Are there bundle plans that will wrap several of your risks into one premium? You might find bundling three specific things can be less costly than insuring one big thing.
Also, how often do you anticipate your risks actually happening? It may be that your business has seasonal challenges, or recurring events that can impose significant financial loss. The right insurance can help insulate your business from overwhelming difficulties.
By sorting out the specifics of your small business risks, you can make doing business a little more stress free. And we think that’s worth investing in.Tags: risk profile, small business, small business insurance
Categorised in: Articles
This post was written by SMB Insurance