Insurance Doesn't Help Your Business Thrive, It Helps It Survive

1. Cyber Insurance

Cybersecurity threats are becoming something to lose sleep over. Businesses, regardless of size or industry, are increasingly targeted. Reported vulnerabilities are increasing as hacking software becomes more sophisticated with technological advancements.

And more than anything, hackers are becoming greedier and more malicious. As a result, cyber breach attacks in the open-source world, like the SolarWinds attack, spread the risk to global organizations.

And even when the attack is locally targeted, the cost is still significantly high, with US companies paying, on average, $9.44 million in 2022 for data breaches. And get this, 47% of US businesses experienced a cyber-attack in 2022.

Ergo, this is the value of cyber insurance for your business (especially if your business accepts credit cards prone to most hacks). A cyber insurance policy allows you to transfer the first-party and third-party costs of a data breach or a cyber-related attack.

These include the cost of computer forensics, data breach notification, card payment penalties, remediation, crisis management, and public relations. Your insurance broker should recommend policies offering complete coverage for these attacks.

That is, cyber insurance should cover first and third-party costs and combine that with traditional business insurance and your E&O policy to offer full coverage.



 2. Business Liability Insurance

Employees come with enormous risks because they make decisions and implement actions that directly affect your business. For instance, an employee driving a business vehicle needs coverage in case of an accident that causes harm to pedestrians, public and business property, or the employee.

Apart from your employees, your business relationship with your customers, creditors, or other third parties can also result in a costly legal dispute, in addition to settlement payments for damages. Therefore, you need business liability insurance coverage to protect your business from potential liability risks. These are:

Workers Compensation

Workers’ compensation insurance helps your business employees get compensation if they are injured on the job. It is mandatory insurance coverage for any business with employees.

Commercial Liability Insurance

Commercial liability insurance protects your business from third-party lawsuits involving bodily injury and associated costs like settlement, medical, and legal expenses.



Employment Practices Liability Insurance (EPLI)

When employees claim wrongful termination, discrimination, sexual harassment, and failure to promote, this business insurance will cover your costs.



 3. Property Insurance

The risks to your business property are many. They can range from property damage caused by natural disasters like floods and hurricanes to theft by your employees or outside parties. Damages to your vehicles, buildings, inventory, and equipment stall business operations. and dig into your cash flow.

You need business insurance to help your business mitigate these losses quickly and at reduced costs. The best property insurance to consider in this case includes:



Commercial Property Insurance

Generally, property insurance covers your entire business property and the assets inside the property. Therefore, this business insurance covers assets, personal property, and equipment lost to natural disasters, theft, or fires.

Your insurance broker can also extend this coverage to protect you from the loss of income after said property risks. Ask your broker for coverage that insures your property against total replacement value, not just the market value, to ensure you get any recent property improvements during compensation.



Commercial Crime Insurance

This insurance protects your property from crime-related losses, sometimes not covered by commercial property insurance. It covers losses of security, money, and property lost to criminal activities, whether instigated by your employees or outside parties.



Commercial Auto Insurance

This coverage extends to auto insurance for your business vehicles.



Business Interruption Insurance

Other indirect events like supply chain breakdowns or technological failure can interrupt business operations. You must, therefore, provide your business with the right coverage to help you remain cash flow positive as you rebuild since commercial property insurance doesn't cover lost revenue.

This is the work of business interruption insurance. The policy covers the lost profits and revenue that result from uncontrollable business interruptions. It is an excellent policy for businesses that have limited capital reserves.



4. Professional Liability Insurance

Service providers are just as liable for legal disputes because some customers might have differing ideas on what quality services entail. And in some cases, the legal argument might have merit, like in the case of a tax preparer making an error while filing client taxes or technology service providers offering solutions that don't meet the desired qualifications.

Still, even when unwarranted, you need protection from customers seeking legal recourse for your services. And professional liability insurance covers you from defense costs and service damages to a limit, usually $1 million.



A coverage option like Errors & Omissions (E&O) gives your business coverage if you offer professional services to third parties like consultants, accountants, and lawyers.

 What to Consider Beforehand

Owning or running a business exposes you to risk. Therefore, you need the right insurance coverage to safeguard against property damage and data breaches, among other business risks. Ultimately, the business insurance that helps your business the most is the one that meets your unique needs. Additionally, the risks your business encounters will differ from those of a similar competitor in your industry. That requires you to consider:

• Your revenue and insurance budget
• Your projected business growth
• Your products and services and the risk profile in your industry
• The type of property you own or the ones you've leased
• The number of employees you have

The possibility of insurance risk is also a critical element to keep in mind as you find the right coverage for your business. For instance, many business owners fail to consider the risks of international manufacturing and transit issues.



In such a case, insurance like business interruption insurance would provide the proper coverage to keep business operations flowing as mitigation strategies are implemented.

Determining your business's most significant insurance risks and buying insurance coverage that protects you is imperative. Also, remember that some business risks require a custom insurance program.

An example is damage caused by natural disasters like earthquakes. Usually, insurance companies don't offer coverage here because it wouldn't be financially viable. If the impact of damage is also unpredictable, it is also likely that many insurance policies will not cover the risk.

Nonetheless, if you are prone to these risks, your insurance broker can arrange for specialized coverage for your business.

 So, Become Adaptable with the right Insurance Coverage

An insurance policy indirectly contributes to the growth of your business (like in the case of getting cash flow from a business interruption insurance coverage). Still, primarily, its core value is to help your business survive by providing a safety harness when the unexpected occurs. So, instead of liquidating your assets or going bankrupt as you try to mitigate insurance risks, get the right business insurance to help your business beat the long and short-term odds.