It’s important for your business to have insurance. Keep reading for understanding business: 5 key reasons your business needs insurance.
It’s estimated that up to 75% of businesses don’t have adequate insurance. As a business owner, you may know having insurance is valuable to cover unexpected losses or hazards, but you still haven’t made this investment.
Failure to have this safety net in place can lead to serious issues. If you still don’t have a full understanding of business insurance or why it is so important, keep reading.
1. It’s the Law
It’s required by law for businesses with any number of employees to have certain types of insurance in place. This typically includes disability, unemployment, and compensation coverage.
Whether insurance is required by law depends on the state where the business is located.
If you fail to purchase and keep the required coverage, it can result in criminal penalties, civil penalties, fines, or exclusion from public contracts. All this will cost more than a business insurance policy. You can click here to learn more about where commercial insurance is a must-have.
2. Protect Your Workers
Workers’ compensation insurance is one part of the coverage that most states make mandatory. It provides compensation for your employees if they suffer illnesses or injuries while on the job. For example, it typically covers things like medical care, missed wages, and funeral benefits relating to the injury or accident that occurred.
3. You May Get Sued
It is a litigious world. If a liability claim or lawsuit is filed against your business, and you don’t have insurance, you may wind up closing your doors.
A single accident, just one broken contract, a disgruntled employee—if this happens, it’s all over. Even if you happen to win the suit, paying for legal defense may cause you to go out of business.
4. Build Credibility
Business insurance does much more than just protect your business. With the right policies, you show your contractors and customers you take managing risk seriously.
Insurance also communicates to everyone you provide adequate protection, regardless of what accident occurs.
5. Helps in Attracting and Retaining Employees
Purchasing commercial insurance isn’t all about protecting the business in various “doom and gloom” scenarios. It provides a positive benefit of helping you attract and retain qualified and talented employees.
In addition to their salary, job seekers will search for benefit packages that include disability, long-term care, health, and life insurance. If you aren’t offering these perks, you may wind up losing a great employee to another business that does.
Gaining an Understanding of Business Insurance: Now You Know
When it comes to gaining an understanding of business insurance, there are more than a few things to know. Keep the information here in mind to ensure that you properly protect your business, employees, and customers.
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