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9 Reasons why you should safeguard your business with insurance.

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In India, having small business insurance is not mandatory but it is necessary. If you are not insured, you might be risking your business. Moreover, the risk is higher in the case of a small business like yours, where 40% of them never get the chance to reopen after a disaster strikes.

On the other hand, having insurance prepares you for various uncertainties that might cause huge financial losses. Many times, you can’t handle such losses all alone. It becomes extremely important for you to buy a good policy in India no matter where you operate from (office or home).

You might want to read this: Types of Insurance for small businesses and what it covers.

Here are the 7 important reasons why you should safeguard your small business with insurance.

  1. Natural calamities can destroy your assets.

    Your property may get destroyed due to fire or natural disasters such as floods, earthquakes, storms, etc.

    When you are insured, it covers the loss incurred from an outbreak of such natural calamity.

  2. You might face losses due to theft.

    Incidents like theft of money from the cash counter, locker can cause a major setback to you. It can even lead to partial or complete closure of your company.

    When you are covered by a good policy, cash and other physical assets such as computers, furniture, etc. are well-protected.

  3. Negligence and errors can bring uninvited trouble.

    Sometimes, due to negligence in providing services, you might gain hatred of your customers who may even deny to pay you.

    A certain type of policy (Errors and Omissions Insurance) helps you deal with the liability arising out of negligence and errors.

    Insurance takes care of any losses that you may have to face because of negligence in rendering any services.

  4. Injury or death of your staff can sue you.

    The injury or death of your employee during the course of his/her work is dangerous. It is not only about the expenses arising out of injuries or illness to staff but also there is a possibility that the employee’s family can sue you. For this reason, in most countries, especially abroad, policy is a mandatory buy.
    Company insurance covers the expenses arising out of injuries or illness to employees. It also takes care of the legal costs if a deceased family decides to legally sue you.

    Even your employees feel safer to work in an insured place.

  5. Your property may get damaged during riots.

    Shops located in urban areas may suffer property losses due to riots when the state is in a disturbed condition. If you’re not sufficiently insured against the property damage, the recovery cost will entirely yours.

    Good insurance helps you with the repair or replacement cost of any damaged property.

  6. You may face huge financial losses due to interruptions.

    Sometimes, during a natural disaster or riot, it becomes difficult for your staff to come to work, it will lead to interruptions that brings loss of income.

    In such situations, an interruption policy helps to compensate for such losses.

  7. Some disputes might end up drawing you to the court

    It is not a rare thing to have conflicts with clients/customers/vendors. Some disputes will become so big that you may want to take it to the court.

    Insurance bears the legal liability arising out of a lawsuit that otherwise has to be paid by the owner of the business.

  8. Vehicles used for commercial services can be met with an accident.

    In India, third party insurance is compulsory for all vehicles plying on Indian roads i.e Any vehicle that provides commercial services in a business should have Insurance.

    Vehicle policy provides protection against any damage caused to the vehicle or the driver or to a third-party in case of an unforeseen incident like a traffic collision, accident, fire, theft, etc.

  9. Moneylenders, clients or the bank may not trust you.

    Big clients, investors, banks view an insured business as a responsible one and believe that their money is safe. Insurance offers credibility to the company. Eventually, it aids in more growth of the company.

    Besides providing you with financial support at critical times, insurance helps your business build credibility.

All in all, without policy, business owners like you may have to pay out-of-pocket for costly damages and legal claims against your company. Depending on the incident, this could be financially devastating for businessmen like you. To conclude, all you have to do is to buy an appropriate policy that provides the proper coverage during uncertainties.

You might want to read this: Types of Insurance for small businesses and what it covers.

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