- On March 9, 2016
Running a small business involves a great deal of forward thinking and even a bit of fortune telling. While owners use all the available data to predict what will occur in the future and plan according, there is no way to foresee every occurrence. That is why insurance is such an important resource- it protects against all those unforeseeable events that may impact your company. Regardless of its strength, many business owners are not properly harnessing the power of insurance. Read on to learn about 5 key mistakes small business owners make with their insurance and avoid falling victim to them as you steer your company into the future.
Mistake #1: You don’t think you need insurance
This is the most treacherous assumption that small businesses can hold. While expense reduction is in the mindset of virtually all small business owners, cutting corners by not purchasing insurance opens you up to exponentially more expenses in the long run. The potential cost of a lawsuit by far outweighs monthly premiums for basic liability insurance.
Mistake #2: You think your homeowners insurance will be sufficient
If you run at least part of you business out of your home, shouldn’t your homeowners policy cover your insurance issues? The short answer is “no”. A homeowners policy does not cover any property (including structures and business equipment) that is used for business. Additionally, if someone gets injured while visiting your home office, your homeowners policy won’t cover you. Coverage to protect against these situations includes Business Personal Property Insurance, On- Premise Liability and Off-Premise Liability and Errors and Omissions Coverage.
Mistake #3: You pay too much for insurance
Don’t go blindly with whatever policies and coverage the agent who provides your personal coverage recommends. Do your homework about the different types of policies that exist and shop around for the best deal that truly addresses your needs.
Mistake #4: Ignoring cybersecurity risks
While tech companies are super sensitive to cybersecurity issues, small businesses often tend to overlook the issue. Potential breaches can include anything from denial-of-service attacks, data lost to viruses or other security issues, or even hacked email, all of which can be costly situations that are typically not covered by general liability policies. To address the threat, companies may wish to consider adding a separate cyberinsurance policy on top of their general liability policy.
Mistake #5: You forgo life insurance
When it comes to many small businesses, a company is its people. If something were to happen to either you or one of your key employees, it may have a devastating impact on your company’s health and survival. Life insurance would provide your family with the financial means to replace what will no longer be generated by the business. This type of coverage does not have to be expensive and can be life changing to your loved ones or the ongoing success of the company you built.
As a small business owner, you have a lot at stake. By discussing your policy options with an experienced insurance agent, you can select the proper insurance coverage to protect your interests and your company’s future.
JDA Insurance Group is an Independent Property & Casualty / Health Insurance Company servicing Florida families and businesses. Our mission is to deliver competitive insurance rates and programs, along with industry-leading customer service. The JDA Insurance Group offers its clients the resources of our largest competitors, with the accessibility and personal care of a local business. If you would like to find out more about workers compensation or request a quote, please contact us or call 561-296-0373.