COMMERCIAL INSURANCE BASICS FOR SMALL BUSINESS OWNERS

Running a small business in California is hard work. Business owners and entrepreneurs need to run a tight ship to improve their cash flow and keep things running smoothly.

However, going into business comes with a variety of risks that can throw a wrench in their operations. Worse yet, these risks can impose heavy financial burdens that small business owners may have a hard time bouncing back from. Some examples include property damage, workplace injury, or even cyber-attacks.

To protect themselves from the financial consequences of such operational risks, small business owners can buy insurance coverage. In this article, we’ll talk about why getting commercial insurance is one of the most responsible things you can do as a business owner. We also give some common examples of commercial insurance that may be relevant to you.

Why Getting Commercial Insurance Makes Sense

Every business, regardless of business size and industry, faces potential liabilities and untoward events that can negatively impact an enterprise. While big corporations can afford to take such hits, the same cannot be said for small businesses and micro-enterprises.

Most small businesses don’t have a lot of cash flow, particularly when they’re first starting out. This means that they can’t afford disruptions to their day-to-day operations. Examples of such disruptions include things like equipment breakdown, loss of stock due to leaks or flooding, robbery, fire damage, vandalism, or system hacking.

The above-mentioned events could put business operations on hold for days. Temporary closures can potentially cause a dip in customer confidence, which could take a while to recover. Due to limited cash flow, small businesses won’t have enough liquid assets to cover the financial loss of such disruptions, even for a short period of time.

This is why it’s important for small business owners and entrepreneurs to invest in commercial insurance. Getting adequate coverage will help them tide over their operations in the event of such unfortunate disruptions.

Now, there are a variety of commercial insurance coverages available for small business owners. Choosing which ones to get largely depends on the type of business you own, and what you need to keep it running. In the following section, we’ll talk about some of the most relevant kinds of commercial insurance coverage:

Auto Insurance For Businesses

Getting commercial auto insurance is important if you run a delivery service, or if you need to drive to different locations to perform maintenance work or meet clients. Getting your company vehicle insured in Califonia is important in case you’re ever involved in a road accident. Auto insurance will help you pay for repairs or part replacements.

Equipment Breakdown Coverage

If your business relies on the use of heavy machinery or any specialized equipment, you have to make sure they’re in tip-top condition. A breakdown can put your operations on hold, and repairs can cost a small fortune. This is especially true if you use custom machinery. Equipment Breakdown Coverage will help you pay for any necessary repairs and part replacements.

Business Interruption Coverage

In case of unfortunate events like a fire or natural disaster, you would need to suspend your business operations. Business interruption coverage can help you recuperate income loss resulting from such temporary business closures.

Workers’ Compensation Insurance

If you hire staff, you need to have worker’s compensation insurance in case of workplace injury. Worker’s compensation will help you pay for your employee’s medical treatments.

To learn more about commercial insurance, visit our website today. If you need guidance in picking the right coverage for your business, Panorama has a ready team of financial advisers that can assist you.