Top 5 Mistakes Made When Getting Small Business Owner Insurance

  1. Overlooking the importance of small business owner insurance. It’s a fact – business people of all types have their own standard set of reasons for obtaining insurance specifically for their business. But not all business owners think this way. Some think the cost of insurance is too much; others think small business owners insurance is not necessary. Some may even make the mistake in thinking they are covered by other insurance policies that they have for their home or for themselves.
  2. This is a major mistake! Not obtaining the insurance specifically tailored for your business often derives as a result of not thinking that the small business owner insurance is necessary. It is necessary! For instance, take a look at general commercial liability insurance. This type of small business owner insurance protects businesses from the costs of any lawsuits resulting from basic damages done to people or property that have even the slightest contact with what you do as a business. If you do not have this coverage when someone decides to slap a lawsuit on you, it could cost you a substantial amount of money, not to mention risk your reputation – even if the lawsuit is a frivolous one.
  3. Not knowing the basic issues about insurance. While many like to think insurance is just insurance, it is not so. For example, would you purchase automobile insurance for your house? Would you get life insurance for your healthcare? The answer is no.
  4. While some issues regarding small business owner insurance are similar to other forms of insurance, they are definitely not the same. A standard small business owner insurance policy will protect your assets in case they get stolen. It most likely will also protect you if bad weather wreaks havoc on your business property. But there are many aspects of your business that this standard policy may not cover; hence the reason for supplemental insurance coverage.
  5. Not getting insurance as early as you need it. If you do not obtain small business owner insurance coverage as soon as you start your business, you run the risk of paying for any damages or loss that occurs before your business is properly insured. Another mistake in regards to this one is the fact that as a new business owner, you may not have a budget for the proper insurance, so your coverage is likely not adequate. In a nutshell, start thinking about small business owner insurance as early as possible in your business – even at the business plan stage, as that will assist you with creating the budget you need to get adequately covered for all future circumstances.
  6. Getting the wrong kind of insurance provider. A lot of business owners make the mistake of seeking small business owner insurance through insurance companies they have already been doing business with. While this may seem like a good idea, it should be looked at very carefully. Perhaps your property insurance provider might not have the kind of experience with the type of small business owner insurance you need for your business.
  7. For instance, if general commercial liability insurance is what your specific business needs, even if your regular provider carries that kind of insurance, they may not have enough developed expertise to know exactly what is right for, or in tune with, your particular needs.
  8. Basically, the only insurance companies and/or agents who have dealt with your kind of business before can help your kind of business and get you properly covered for your particular situation.
  9. Lastly, getting the wrong kind of coverage. Apart from getting the wrong kind of insurance provider, the last mistake is getting the wrong kind of small business owner insurance coverage. As the owner of your business, it is up to you to make the right business decision for your company. After all, you are the person most suited to look out for your own interests. Considering this, as you go through the entire process for obtaining small business owner insurance, be sure to collect all necessary information and talk to the right people.

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