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3 Types of Business Insurance that are Essential for SMEs

Small and medium enterprises (SMEs) are the backbone of the American economy. Every day countless transactions take place between SMEs and a wide range of stakeholders, from vendors to clients to employees. This means that the risk of something going wrong is something that entrepreneurs have to take into account. Even though the thrill of taking risks and the process of learning from past mistakes are aspects of running your own business that are understood by those with an entrepreneurial flair, it does not mean that you have to be unprepared. That’s where business insurance comes in. But what kind of insurance is the best for your enterprise?

General Liability Insurance

One of the most fundamental types of insurance is business liability insurance, also referred to as general liability insurance. In essence, this type of protection policy will cover you against all kinds of accidents. It safeguards your company against accidents that could end up costing you a great amount of money, like bodily injury, which is why it is also known as “slip-and-fall” insurance. Any type of physical injury that is incurred when a third party like a customer visits your shop or when they are hurt due to your handling of equipment or faulty facilities that you have set up could legally end up being your responsibility – including medical and hospitalization costs, loss of income, long-term injury treatment, etc.

General liability insurance also covers personal injury, which includes non-tangible damages like defamation, libel, or copyright infringement. Lastly, it includes property damage for third parties, which can be tailored according to your needs to cover anything from a small scratch on the floor to water damage.

business essentials

Source: Pexels

Property Ιnsurance

Accidents don’t only happen to other people – it is equally probable that your own business might be at risk of damage, too. The first thing you need to look at is insuring any property that is essential for your day-to-day operations. This is particularly pertinent if you own your business premises or if you have started a home-based business, but it applies equally to enterprises that rent out space. Depending on where you carry out your business and the type of activities that you are most involved with, you are likely to need insurance that covers more specific criteria. For example, if you are based in a state that gets a lot of heavy rain throughout the year, it is wise to invest in flooding insurance.

property insurance

Source: Pexels

Vehicle Ιnsurance

Many companies opt for one or more company cars, which has many pros and cons. This could be the car that your employees use to provide services on the client’s premises, a vehicle reserved for delivering your products, or even a perk given to some of your employees. Yet it also carries the risk of incurring damages from road accidents or vehicle damage in general, so vehicle insurance is of paramount importance. This could range from simple third-party liability insurance to a fully comprehensive plan, depending on your budget and needs.

Insurance is one of those unavoidable costs for most businesses, and even though it might sometimes sound like a luxury, it could mean the difference between surviving unscathed and bankruptcy when you actually come to need it.

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