YOUR MONEY: Policies to consider
By Brad Oltmans, special for Inside Tucson Business
Published on Monday, December 28, 2009
Whether you own a coffee shop or an office building, running a business in today’s economy isn’t easy.
One of the biggest challenges both start-up and experienced business owners face is taking and maintaining the necessary precautions to safeguard their business and assets from the unexpected. After all, without proper protection, a natural disaster, lawsuit or other misfortune could mean the end of your business operation.
While business owners are unable to predict the future, they can take a variety of measures to protect their business and assets. The best way to do this is through procuring adequate commercial insurance coverage.
From business interruption to website, Internet-based and e-business coverage, the following is a list of commercial insurance policies small business owners should consider:
• Business interruption – Business interruption coverage typically covers losses stemming from natural disasters or other events that result in a business ceasing operation for an extended period of time.
• Crime – This will cover losses incurred from most criminal activities, including hacking, vandalism, theft, forgery and embezzlement.
• Disability – If an employee is injured and can no longer work, a disability insurance policy will pay a portion of his or her salary.
• Home-based business – Homeowners’ insurance policies often do not cover losses incurred by a home-based business. Consequently, home-based business owners can secure an additional insurance policy to protect their business property, liability, crime and theft, as well as employees and clients on the premises, among other risks.
• Key employee – This offers personal liability protections to key employees, such as directors and officers, should there be a claim against the business. In addition, this type of coverage can also provide life insurance for key personnel, naming the company as a beneficiary if the key personnel dies or becomes disabled.
• Medical – This will enable business owners to provide health and medical coverage for their employees.
• Product liability – Depending on the nature of the business, it may be prudent to have insurance to protect against lawsuits resulting from any potential harm caused by a product. Product liability coverage can protect a business against negligence claims when it comes to defective products, warnings and instructions as well as a breach of warranty, among other risks.
• Professional liability – Should business services be rendered by a licensed professional, the business owner should consider professional liability coverage. This coverage can offer protection against bodily injury, property damage, medical expenses and settlements, among other risks.
• Property and general liability – In addition to covering disasters like fire or flood, property and general liability coverage provides protection against property damage, bodily injury, medical expenses and legal costs, among others.
• Vehicle and/or fleet – Whether employees drive vehicles owned by the company or regularly use their personal vehicles for company business, a vehicle or fleet policy will cover liability for injuries should these vehicles be involved in a collision.
• Worker’s compensation – This pays for employees’ medical expenses and missed wages if injured while working and is required in Arizona. It typically covers lost wages, as well as medical and rehabilitation costs for employees injured on the job.
• Website, Internet based and e-business – A growing area of business insurance, website coverage provides protection against claims taken as a result of something on a company’s website. In addition, Web-based businesses should consider Internet business coverage, which will protect them from damages incurred by viruses, hackers, banner advertising and electronic copyright infringement.
The bottom line is that commercial insurance is available for practically any risk and is one of the biggest preventative measures business owners can take to protect their business and assets from the unexpected.
If you’re in the process of starting a new business, carefully consider your insurance needs and options. If you already have a business, check in with your insurance agent at least once per year to ensure your needs haven’t changed.
Contact Brad Oltmans, vice president of Insurance Services for AAA Arizona, at boltmans@arizona.aaa.com or (520) 885-0694 ext. 2751.
