BUSINESS Insurance is an important aspect of business startup process that is often over looked because its importance is not understood by a lot of entrepreneurs. Business insurance is important to an entrepreneur because it protects the business from unfortunate events and different types of losses (whether temporary or permanent).
No business is risk free no matter the industry, so insurance should be an important part of your business risk management plan so that you don’t find yourself going bankrupt when you face or encounter such situations. There have been cases of entrepreneurs loosing valuables to fire incidents, theft etc. only to run out of business or struggle to recover because of the resources required to replace such valuables.
Standard insurance companies understand the risks affecting your industry and they often have coverage options to help ensure your business is adequately protected. A good insurance company however can always modify to suit your business needs.
Some reasons small businesses should insured include:
Legal requirement – By law, you are required to have a certain type of insurance cover for your business against certain losses before the business starts to operate. Failing to abide by this requirement can lead to closure of your business.
Fire and natural disasters – It is also important to insure your business against fire and natural disasters. In the event of natural disaster or fire your business will not come to an end or find it hard to recover after the loss because your insurance company takes care of every expense
Customers – It is equally important to protect customers and workers against accidents. In the event where an employee has an accident or a customer is injured by your product, you would not have to worry because the insurance will take care of it.
Theft – Replacing equipment or business property stolen can be expensive. Having an insurance cover against burglary is very important. In the event that something gets stolen you just sit while the insurance company takes care of the expenses to replace the stolen item(s)
Before you engage an insurance company, ensure you carry out your due diligence to be certain that the company is able to cover your losses when the need arises.
- Afolabi is a Microsoft Intern at FATE Foundation.