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Why Your Business Needs Insurance?

IndianMoney.com Research Team | Updated On Wednesday, August 01,2018, 03:46 PM

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Why Your Business Needs Insurance?

 

 

 

Your business is your heart and your soul. You will do anything for it. It’s your livelihood and sustenance. Simply speaking….It gives you a lot of money….Don’t you think it’s necessary to protect your business? Business is all about risk. Uncertainty in business contributes to risk. But, there are some risks that can be avoided. This is where you need business insurance.

Different businesses have different insurance needs. You have office and shop insurance, goods insurance, product liability insurance, public liability insurance, workmen’s compensation, professional liability insurance, Directors insurance and even cyber insurance.

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Why Your Business Needs Insurance?

 

Think your business is too small for insurance? No business however small is free from risk. There is insurance for all types of businesses in India. You can avail small business insurance and there is insurance for even SMEs and startups in India.

 

1. Fire and allied perils insurance:

 

If your business suffers losses in a fire (this could be accidental or intentional), you are compensated for the loss/damage. Fire and allied perils insurance protects your business from riots, strikes and even acts of terror. Many fire and allied perils insurance plans, offer in-built cover against earthquakes, floods and even storms.

Fire and allied perils insurance protects your office premises like elevators, fences and even the boundary walls. Office contents like furniture, office equipment and furniture are also covered.

Make sure you declare all expensive items in your office.

 

SEE ALSO: Need for Business Insurance in India

 

2. Business interruption insurance:

 

Take a business interruption and consequential losses plan, along with the fire insurance plan. This plan covers the loss of profit your business suffers, due to interruption in operations. You are covered for the loss in gross profit due to a reduction in business turnover and even auditor’s fees.

 

3. Burglary insurance:

 

Your business stands protected against a burglary or an attempted burglary. Theft of jewelry, theft of title deeds and business books, are common exclusions under burglary insurance.

 

4. General third-party Liability Plans:

 

This plan protects your business from legal liabilities. This could be personal injury to a third-party where harassment and discrimination charges are filed. This plan also covers you from advertising problems. This could be invasion of privacy, copyright infringement and even libel. For those who don’t know, libel is a false statement damaging a person’s reputation.

 

5. Product liability insurance:

 

The products of your business may cause loss/damage to a third-party. You have to compensate this third-party and product liability insurance takes care of this.

 

6. Legal liability insurance:

 

This type of insurance protects your business from legal liabilities which might arise from personal injury/losses to employees, customers, business-partners and even unrelated third-parties.

 

7. Professional indemnity insurance:

 

If you are in the business of providing professional services, you better have professional indemnity insurance. This plan covers any legal liability arising from omissions/negligence while rendering services. If you are an engineer, doctor, chartered accountant, lawyer, interior designer or even a management consultant, you better have professional indemnity insurance.

See Also: Business Loan By Governement

8. Fidelity guarantee policy:

 

If your business suffers a monetary loss because of deception (trickery and treachery) on the part of employees, you are covered for the loss. You can take this insurance to cover the entire staff or all managers, store-keepers or even accountants.

 

9. Workmen compensation insurance:

 

According to the workmen’s compensation act and the fatal accidents act, 1855, you (businessman) will have to pay compensation to employees on death/bodily injury/accidents during their employment for occupational hazards of a job.  

 

10. Key-man insurance:

 

Key-man insurance is nothing but a term life insurance plan, for say a director, founder, co-founder, project manager or even a salesman who possesses specialized knowledge/skill and is very important to your business. Key-man insurance works just like any term life insurance plan. On the death of the key-man (director or a manager), your business is paid a lump-sum to cope with the loss of this person.

If you own a shop, make sure to avail fire and allied perils insurance to protect your business from a fire. You can also avail workmen compensation insurance, burglary insurance, fidelity guarantee policy or even product liability insurance. Be Wise, Get Rich.

 

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IndianMoney.com Research Team

The research team at IndianMoney.com comprises of certified and experienced professionals who share the company's vision to make every Indian financially literate by equipping every Indian with right and unbiased advice. IndianMoney.com research team provides newsletters, articles, videos and FAQs on various financial products and concepts only to help you make wise financial decisions.

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