Insurance is critical to the long term financial success of any business. Not having adequate insurance in place when a catastrophic event happens can cost you the business you worked so hard to create. While there a many different types of insurance available, here are three that every small business should have.
This type of coverage protects the business from bodily injury or property damage that your business could be held liable for. A recent example is the probable lawsuit following the E. coli outbreak at Chipotle earlier this year. Should they face a suit, their Commercial General Liability (CGL) policy will provide coverage. Not only will this type of insurance provide coverage for damages, it can also pay for attorneys fees.
Property coverage provides insurance protection for any property your business owns or property of others that may be in your care, custody, or control. Some examples are the furniture and equipment in your office. If you own the building you occupy or did an extensive build out in the space you lease then property insurance should definitely be in place. When the tornados of 2011 hit the Chattanooga, TN area, having enough property insurance allowed many business to reopen after the storms passed through.
While property insurance will pay to replace your building and business property after a major disaster it will still take time to rebuild or replace what was damaged. Business interruption steps in and provides coverage for lost income or revenue while the business cannot operate due to the covered loss. An example would be the fire that closed Brewhaus for several months a little over a year ago. Assuming they had adequate insurance, the business interruption portion of the policy would have paid for any lost revenue while they were closed. This coverage is critical to a business reopening after a major disaster.