At times, the concept of commercial insurance can be a difficult one to grasp. This has led to distorted information, incorrect assumptions, and generalizations. Perhaps it’s the jargon, or maybe some people just cannot be bothered to read the documents involved. Whatever the reason, entrepreneurs should realize that perpetuating these myths about commercial insurance could jeopardize their businesses.
Here are the top five myths of commercial insurance and why it’s time to junk them.
Small or home-based businesses do not need coverage
The location has nothing to do with anything. Some entrepreneurs assume that they do not need to get commercial insurance because they already have personal or home insurance.
Commercial insurance is a safety catch in case the company suffers any setbacks. This means it doesn't anticipate the same risks covered in home or personal insurance. A business owner's personal insurance won’t be helpful in getting the company back on track should it suffer financial losses, but commercial insurance can.
There is such a thing as “full coverage” insurance
Since most business owners prefer not to read the legalese surrounding insurance policies, it is understandable how they simply choose to assume that “one size fits all.” Most purchase the “Comprehensive General Liability” package and assume that they have all the coverage they need.
This is incorrect. Though a general policy may be useful, there are other liabilities that may not be included, leaving the company still open to these risks. Discuss all available liabilities with your insurance agent.
Setting up a corporation can protect the individual
Some business owners assume that their personal assets are protected, as long as they have a corporation in place. However, a lawsuit can be filed against the individual business owners and the corporation cannot shield them from liability.
A successful lawsuit could result in the business owner’s loss of the business and personal assets.
Belief that the business will never be sued
This is a dangerous belief to hold on to. It’s similar to the oft-repeated “nothing bad is going to happen” -- a mantra people invoke when justifying their lack of insurance coverage. Nobody can anticipate the future, and this is doubly important when a business is at stake.
Even the smallest business can be sued, and the expenses of dealing with a lawsuit can ruin the business for good. Commercial insurance can help protect your business from the financial difficulties caused by lawsuits.
Commercial insurance is expensive
One thing most people – entrepreneurs or otherwise – mistakenly believe is that insurance is always costly. Since they don’t understand what insurance actually offers, it can seem like an unnecessary expense.
It is possible to tailor a commercial insurance policy that offers the best available coverage for your company without costing an arm and a leg. You just need to pick out the type of coverage and additional liabilities you need to insure. Negotiate your insurance costs and you’ll be glad to discover that most agents are quite flexible in what they offer.
Your business needs protection. Call Carlton Wright Insurance Agency at 1-800-6873 now and get a free Roanoke commercial insurance quote for your business.