Buying commercial insurance for your small business is one of the best ways to protect your personal assets from the risks of the business. Here are some of the ways business risks may affect your personal assets, and how business insurance can help.
Settling Liability Claims
Every business faces potential liability claims from its customers or third parties. Below are some examples of these claims:
If you don't have the right insurance, you will be forced to use your business assets to compensate the claimants. If your business assets are inadequate, which is possible for small businesses, you will have to dig into your personal assets for the compensation.
Paying Legal Costs
There are many lawsuits your business can face apart from the liability claims. For example, a supplier or client can sue you for breach of contract if you don't deliver on your agreement in time. A competitor can sue you for copyright infringement. Clients can sue you for false advertising.
All these lawsuits cost money to defend. You have to defend your business even if you are innocent. The right insurance policies will cater for the costs of these lawsuits so that you don't have to spend your personal assets.
Replacing Your Business Car
Personal auto insurance doesn't pay for damages that arise in the course of commercial use of the car. For example, if you use your personal car to deliver your products to customers, your auto insurance carrier will not repair the car if you are involved in an accident during delivery. Thus, you will lose your car if you are involved in a serious crash and the car gets totaled. You will have to use your private funds to replace the car. The right commercial auto insurance, however, will replace your car in such circumstances.
Rebuilding After a Disaster
Lastly, a serious disaster can halt your business operations for a long time. For example, you may require months of reconstruction to rebuild your business if a fire outbreak razes the premises to the ground. In the meantime, your workers will still need to be paid, among other financial obligations. All these can be difficult to do if you don't have commercial insurance; your personal assets might suffer.
Talk to a company like Cache Valley Insurance Inc to help you buy the right coverage for your business. Don't operate even for a day without appropriate coverage since you don't know when disaster might strike.Share
24 May 2019
I have always been someone who loves to work hard for what they have, which is why I started paying attention to how I was protecting my investments. I realized that although I had great medical and dental insurance, my car needed a little extra protection. I started working hard to find an insurance policy that would work well for my needs, and before I knew it, I was able to sign up for a new policy. This blog is all about choosing a car insurance policy that works well for you and your family, so that you don't have to worry about falling short.