As a small business owner, you are sure to be juggling a range of competing financial demands such as operational expenses, employee salaries, marketing, capital expenditures and more. Focusing on all these may mean that appropriate insurance coverage becomes overlooked, seen as an unnecessary additional expense that there is no time to consider.
Adequate Small Business Insurance cover is crucial when it comes to protecting your business from unforeseen events. Dismissing this may lead to greater expenses and mental energy later on to deal with accidents or misfortune. The right coverage is especially important for small businesses who are yet to create a great profit, and for whom an unfortunate event could impact owners, staff and lead to business closure.
Learn more about the risks of improper Small Business Insurance, and how to mitigate this risk to ensure your business is prepared for any circumstance.
The 4 Main Risks For Businesses
1. Financial Loss
Without a good level of coverage, your business is at risk of sustaining a financial loss due to property damage. This can subsequently result in an inability to meet wage costs further impacting your ability to deliver services to your customers. These incidents have the potential to lead to financial strain or even bankruptcy especially if the impacted business is in its infancy.
2. Legal Liability
If an incident involving personal injury or property damage is caused as a result of your negligence this can represent significant financial impost on your business. Even if this is an allegation which you believe to be unfounded as an entity you are required to respond to allegations made. In doing so, you can attract significant expenses and, if found liable, then damages and costs incurred can also be claimed by the impacted party.
For this reason, Atlantic Insurance takes the time to ensure your Liability coverage is adequate and tailored to your Business to ensure that, in the case of a claim, your Policy will trigger an appropriate response. If you are found liable for claims involving personal injury, medical bills, lost wages and business interruption can be considered as part of the damages, and you will require a proactive legal defence.
3. Reputational Damage
For business owners, the reputation of your company is important to attract and retain customers, clients and employees. One incident is all it may take to damage your reputation. If you do not carry the necessary insurance, you may be unable to address these incidents, maintain consistent service levels provided by established, well-trained staff, and the reputation of your Business can be adversely impacted.
There is no one insurance product that provides this level of protection, instead it is one of the more intangible benefits provided by an Insurance program tailored specifically to your Insurance needs.
4. Penalties And Fines
If your business fails to comply with regulatory standards, penalties or fines may apply. Some compulsory insurance policies that may be required for your business to comply with regulations include Workers’ Compensation and Public Liability Insurance.
As Business.gov.au explains, Workers’ Compensation Insurance is compulsory if you have employees at your company, while Liability Cover is compulsory for certain types of businesses. If you would like to check what is compulsory for your business, the site has information on business requirements by industry.
5 Ways To Mitigate Risk
1. Undertake A Risk Analysis
Take the time to understand the specific risks that your business may face, including any potential hazards or liabilities. You may work out what cover is necessary from this analysis and make informed decisions.
2. Work With A Professional Insurance Broker
A reliable, professional Broker will assist you in identifying risk and finding the appropriate coverage with policies tailored to your specific requirements. This Broker will have knowledge associated with similar business and the experience of past claim scenarios to draw from to ensure you are adequately protected.
3. Regular Review
As your insurance needs may change over time, it is important to regularly review and update your coverage to ensure it is current. The right Insurance Broker will provide options as your Business evolves, as this often increases your Insurance spend. Excess options and carefully considered levels of cover can offset some of these Increases whilst maintaining the right coverage for your Business.
4. Accurate Records
Keeping accurate records of claims and insured events will assist in receiving the appropriate compensation for any loss. Proof of ownership is often the first step in assessing a loss, therefore being able to provide invoices, photographic evidence and receipts always assists with this process.
5. Prioritise Risk Management
Making risk management a priority will reduce the likelihood of incidents. It is important to implement safety protocols, conduct employee training and adopt industry best practices.
Failure to do so could have a direct impact on your claims history which has the potential to impact future premiums.
Reliable Small Business Insurance With Atlantic Insurance
Our experienced Client Managers at Atlantic Insurance are Business Insurance specialists, dedicated to curating an Insurance Program that meets the specific requirements of your business, with competitive premiums. Contact us to receive a quote and ensure the protection of your small business.
Any information contained on this page of the website is general advice only and has been prepared without taking into account your objectives, financial situation or needs. Your should consider these, having regard to the appropriateness of this advice and the relevant Product Disclosure Statement (‘PDS’), Target Market Determination (‘TMD’) and Financial Services Guide (‘FSG’), which will be provided following any formal recommendation to you.
