Many people mistakenly believe that business insurance is boring. However, being in this line for a while now, I can confidently say that business insurance is far from boring. Through my job, I listen to stories about vandalism, fires and even lawsuits - stories that are more interesting than you think!
Believe it or not, the concept of business insurance started in a coffee shop in London. Lloyd's was a coffee shop that merchants and sailors often gathered.
The coffee shop realised the dangers of sailing, and picked up on the merchants' fears of pirates, accidents and lost goods at sea. Lloyd's then began selling marine insurance, and from then on, business insurance continued to grow for 300 years, into the gigantic industry that it is today.
I believe for many of you business-owners nowadays, pirate insurance would not be as useful (I hope!). However, there are still some forms of insurance that are much more relevant to you and your business.
1. Workers' Compensation Insurance
This insurance type actually started off as a negotiation between business owners and their workers. Workers were getting tired of paying exorbitant prices for their injuries at work. Business owners were also getting tired of workers suing them over accidents at the workplace.
Through Workers' Compensation Insurance, employers will not have to fear lawsuits over workplace accidents (so long as their employees are not doing anything reckless!).
2. Professional Liability insurance
It is human nature to make mistakes sometimes. Professional Liability Insurance can shield professionals in high-risk industries, where one seemingly minor mistake can potentially cost clients major losses.
This policy is a legal requirement for some organisations. For others, although not compulsory, Professional Liability insurance allows certain businesses to grow their customer base. Especially when you are a software developer, consultant or architect, this insurance type will provide your clients the assurance that if you make a mistake, you will be able to cover your losses without sacrificing your clients' money.
Notably, Professional Liability Insurance can also be useful when you have been accused for making a mistake that someone else was at fault for too!
3. Property Insurance
Property Insurance protects your stuff from things like vandalism, weather damage, theft and fire. Picture this - you run a candle business. One day, your shop is set on fire because a lit candle was accidentally left unattended. Property Insurance can help you to lift the financial weight of replacing every candle in your shop, and compensate for all the other damaged items.
Many also do not realise this - property insurance can be layered with Business Interruption Insurance.
Back to the candle example: you will definitely have to cease operations for a while. Business Interruption Insurance can cover your profit loss while your business is closed for repairs. Although your business has stopped operating, Business Interruption Insurance ensures that you are still able to pay your taxes, salaries and loan payments.
4. General Liability Insurance
General Liability Insurance is able to benefit almost all businesses as it protects businesses from basic risks such as:
damage to others' property
slip-and-fall accidents
lawsuits
In other words, if you break something, say something offensive, or injure someone, there is a high likelihood that General Liability Insurance will be able to compensate for the financial costs of covering for these accidents.
Business Insurance: a 300-year adventure
Since the birth of business insurance in a coffee shop in London 300 years ago, business insurance has undergone major changes to adapt to the everchanging needs of the world. It is eye-opening when you realise just how much this product has evolved through the years, and how it has helped so many businesses across the globe.
Comments