In business, there are many risks and uncertainties, some of whose effects can bring a business to its knees with a single blow. Whether you deal with a particular line of products or you provide certain professional services, liability insurance is one of the most important insurance policies you should buy. The most common types of liability insurance include errors and omissions (E&O), employee liability insurance and general liability insurance. These serve to protect your business against lawsuits related to service provision in general. In case your business is found at fault in a lawsuit, the insurance company takes care of compensating the plaintiff for damages resulting to the same.
Well, this being only a brief overview, here are the top 5 benefits to buying liability insurance for your small business.
- It Protects Your Investment
Some lawsuits can be really serious to the point that they result in liquidation or closure of your business. This is because some lawsuits can be really expensive and will cost you more than legal fees and court costs. The resulting financial burden can even drive your business into bankruptcy. This is the case where the court rules in the plaintiff’s favor in an O&E lawsuit and you’re left owing thousands or hundreds of thousands to people. Liability insurance can help protect your investment.
- It Attracts Credibility
Having an active liability insurance policy shows your potential clients and business associates that indeed you have confidence in your business and the quality of your work. As a matter of fact, insurance is one of the things most people consider before choosing a particular service provider or brand. in some cases, investors and clients may ask you to provide proof of liability insurance before getting into a contract with your business.
- It Saves Money for Your Business
Spending money on E&O cases or paying for damages after a lost lawsuit can be financially draining. Even if it doesn’t completely cripple your business, these are losses that you can avoid by simply buying a liability insurance policy. With a good liability insurance cover, the premiums you pay would be a drop in the ocean compared to the money you’d have to spend on negligence, errors, and omissions cases especially if you suffer defeat. As a matter of fact, you can even save money on your premiums if proper risk management strategies are adopted and there are fewer claims on your policy.
- It Keeps You Legit
In most places, business insurance is a legal requirement. For instance, it’s within the law for employees to have certain types of insurance such as worker’s compensation. Lacking such covers could attract legal fines and penalties, not forgetting the risk to lose your licensure. Buying liability insurance keeps you on the right side of the law.
- Less Worry = Higher Productivity
Without liability insurance, it’s natural for any conscious business owner to get or stay worried, wondering what would happen if their business were to face a serious claims lawsuit. With a good liability insurance cover, such worries are eliminated. This allows you to concentrate on growing your small business to an authority in your region, industry, or line of specialization.
From the pointers above, it is clear how important it is to get liability insurance for your small business. Thanks to the power of the internet, you can easily get a good insurer for a business liability cover in your local area. In case you come from the Sunshine State, for instance, a simple online search on liability insurance in Florida for small business would do the trick.