A small business is exposed to various crisis situations. Such projects as notaries, hair salons, and beauty salons can go bankrupt or become successful very quickly. As the turnover and profits for such organizations are rather small, any crisis or error can be “fatal.”
A force majeure (such as a fire or an off boarding of a valuable employee) could erase all the previous financial success of the company.
Business insurance is helpful in critical situations of that kind and saves the organization from crisis. That is, a company can continue its activities.
Fees and payments
As a rule, the owner of a small business has surplus funds and is not ready to pay for a permanent insurance. So, it is important to remember that in the case of a crisis or accident only lifeline may be paying for the insurance.
This sum is able to help offset the company’s debts or to restore the smooth activity of the organization quickly. In this case, regular insurance payments will not cause a significant damage to even a small budget.
Small business: types of insurance claims
Small business insurance is one of the most popular areas of safety wire. That is why there are many types of small business insurance: property insurance, liability insurance, and business interruption. One can use all these kinds of protection at the same time or select a number of the most relevant options.
Property insurance is useful in case of equipment, office space or items damage. Liability insurance is useful for those who have done any harm to the third parties. Well, insurance against business interruption is useful in case of a force majeure – fire, flood, or any other situation in which it is necessary to stop the work of the organization.
People insure small business like everything else
Before a company receives a small business insurance, the insurers assess and examine a number of factors: the number of employees, the cost of machinery and equipment, profitability and turnover.
The total value of machinery and equipment of a small business should not exceed half a million dollars. Annual revenue should not be more than ten million, and the amounts under the contracts should not be more than one million.
As usual, a comprehensive insurance that includes all risks is cheaper. Therefore, it is better just to insure the property interests (theft, fire, natural disaster, etc.) first.