Running a small business comes with unique risks, and protecting those assets is essential for long-term success. Having the right insurance coverage can make the difference between a minor setback and a significant financial burden. Here are some practical insurance tips for small business owners, including examples and statistics to show why each type of coverage is so important.
1. Review Your Policy Regularly
As your business grows, your insurance needs will evolve. Reviewing your policy annually ensures your coverage stays up-to-date with new assets, employees, and potential liabilities.
- Example: A tattoo shop avoided $25,000 in losses by updating its policy to cover additional equipment purchased over the years.
- Statistic: A surprising 40% of small businesses don’t have adequate coverage, exposing them to financial risk if an incident occurs.
2. General Liability Insurance is a Must-Have
General liability insurance protects your business if a customer or client claims they were harmed on your premises or by your products/services. This coverage is crucial for industries with physical interaction with clients, like tattoo shops.
- Example: One tattoo parlor won $50,000 in a case after a customer claimed they experienced an infection. Without liability coverage, the business could have faced significant financial strain.
- Statistic: Each year, 43% of small businesses experience a lawsuit, making liability coverage a necessary protection.
3. Consider Equipment Coverage
Equipment is one of the most valuable assets for a small business. Equipment coverage helps cover the cost of repairs or replacement if your business equipment gets damaged or breaks down.
- Example: A tattoo studio was able to save $18,000 on equipment repairs due to having equipment coverage in place.
- Statistic: One in four small businesses encounters equipment issues each year. Equipment coverage keeps unexpected costs from affecting your cash flow.
4. Workers’ Compensation Insurance is Essential
Employees are invaluable to a small business, so protecting them with workers’ compensation insurance is vital. Workers’ comp can cover medical expenses and lost wages if an employee is injured on the job.
- Example: A small business faced a $20,000 claim when an employee got hurt, which was fully covered by workers’ compensation.
- Statistic: Approximately 34% of small business insurance claims are related to employee injuries, so not having this coverage can be costly.
5. Cyber Liability Insurance for Digital Protection
Data breaches are a growing concern, even for small businesses. Cyber liability insurance protects your business from the financial impact of data breaches and cyber attacks, which can lead to legal fees, customer notifications, and damage control.
- Example: One small business faced a $15,000 cost after a data breach compromised client information.
- Statistic: 60% of small businesses close within six months following a cyber attack. Cyber liability insurance can help ensure your business’s survival.
Protecting Your Business with Comprehensive Coverage
From general liability to cyber insurance, protecting your business through strategic insurance policies is essential. Assess your unique needs, stay up-to-date with policy reviews, and seek expert advice to get the right coverage for peace of mind. Taking the time to secure the right policies ensures your business can continue to thrive, even in the face of unexpected challenges.
For more information, text or call Monreal Insurance Solutions at (909) 757-1311, or click the link in our bio for a quote.