If you’re a business owner you’ve almost certainly got some form of insurance. But this doesn’t necessarily mean that you’re covered. There are some situations where you might think you have the right insurance, but haven’t.
Let’s say you’re a private consultant. Now, it’s probably the case that you’ve got insurance on your car right? Unfortunately, that’s probably not enough to cover you for your business travel. Car insurance companies usually demand that you declare that you use a vehicle for work or business, besides commuting. The reason for this is that the vehicle is likely to be used in a different way and, as a result, have a different risk profile.
It’s likely you’ll be using your vehicle more often, you’ll be travelling more miles, and going to riskier locations. It means that you’re probably more likely to be involved in an incident. And it means that you’re likely to cost the insurer more in the long run.
Not insuring your car for business use can actually void the rest of your insurance. That means, if it is discovered that your car is used for business even if you only crash it on the way to a party, you’ll probably get nothing. Replacing a vehicle and paying out for damages to a third party can be very costly and derail your enterprise. Don’t risk it. Get business vehicle cover and make sure your insurer knows exactly what you’re doing. Then, if the worst happens and you’ve done everything by the book, they’re obliged to pay up.
Another issue you might face, especially if you’re a freelancer or a home-based business, is home insurance. Let’s say that you’ve just moved out of the office, and can now work from home. Your current home insurance is probably inadequate for your business needs.
First, there is the obvious problem that the cover probably won’t be enough to meet all the costs of your office equipment. This alone might be in excess of the maximum contents cover an insurer is willing to pay out. Think about the value of all the computer equipment you have installed, as well as desks, chairs and filing cabinets.
But more than this, what would happen if a delivery person got injured on your property? Your current home insurance for domestic use will not cover the costs of injuries to third parties coming to and from your business premises.
That’s why it’s a good idea to get a quote for a home business insurance policy. It’s at least worth finding out what the additional cost might be. Plus, what’s the point of paying for insurance when you’re not fully covered?
If your work involves advising people on what decisions to make, you could eventually find yourself being sued. Perhaps the advice or guidance you gave was unreasonable and negligent. In these situations, there may be a legal basis for a lawsuit to be brought against you.
How much those damages might be is anybody’s guess these days, so getting cover for professional negligence is essential.