Risks are everywhere, which is why insurance companies thrive, selling you insurance packages and policies to protect you and your property by having policies that pay you in case of loss, damage, or injury. And, as you already know by now, insurances aren’t only for one’s health and property. There are insurance companies that offer insurance to businesses and organizations, yet these insurance companies have different types of insurance, so it’s important for you to distinguish the different types to know what the cover and which ones apply to your company’s nature and operations:
Property Insurance
Perhaps the most common and basic insurance, property insurance covers your company’s physical assets (apart from vehicles), ranging from the building itself to your furniture, computers, and other items used in your operations. Some property insurance can even provide payment to cover expenses in protecting your business from additional damage, as well as the funds required to continue your operations until the damages are repaired.
Liability Insurance
Businesses are no strangers to being sued by customers and other private entities due to the negligence of services or harm due to selling defective products. Liability insurance, as the name suggests, pays for any damages and legal expenses if your company is sued due to the aforementioned reasons. This type of insurance normally covers the medical fees of those injured or harmed by your service or product.
Commercial Auto Insurance
Similar to personal auto insurance, commercial auto insurance insures vehicles owned and used by the company. This insurance covers any damages sustained by the vehicles during an accident and generally covers bodily injury as well as property damage caused by the company vehicle during its operation. There are different policies under commercial auto insurance, you can even get one wherein the vehicle involved in the accident can be replaced. Certain vehicles may need specific vehicle-specific insurances, such as forklift insurance.
Workers Compensation Insurance
In most states, workers compensation insurance is required for businesses and employers that have a certain number of employees. This particular insurance policy covers the costs for treating injuries and sickness of the employees, as well as to cover for lost work days due to illness or injuries. Employees should take note that these insurance only cover injuries and illnesses suffered while on the job.
Bonus: Captive Insurance Company
Sometimes, there are risks in your particular line of business that aren’t covered by traditional insurance companies, which is why captive insurance could be the best option for your company. Captive insurance is a corporate “self-insurance” wherein the captive insurance company is owned and controlled by the companies it insures (generally a group of related companies or companies in the same industry) whose purpose is to insure the risk of its owners. This is normally done to avoid using traditional insurance companies which may not meet the specific needs of particular industries or companies. There are many complex issues and compliances with captive insurance to ensure that it’s not taken advantage of, which is why it’s important for companies to hire a captive insurance lawyer when forming or joining one.
Conclusion
Having your company’s assets insured is important to protect yourself from loss and damage, but it’s just as important to know the different types of insurances and what they cover in order for you to choose the best one for your business.
