Most businesses need some sort of insurance to operate. However, so many business owners still know virtually nothing about commercial insurance. Not understanding business insurance could land you in a lot of trouble if you don’t know what’s being covered. You could also have to pay more than you expected during claims. There are so many dangerous myths floating around that could have disastrous consequences if you believe them, and they should be dispelled before you start looking for cover. Let’s take a look at a few common myths about business insurance you should forget immediately.
My Business is too Small and Anonymous for Me to Buy Insurance
This first myth is complete nonsense. If anyone should buy commercial insurance, it’s small businesses, especially those operating as sole proprietorships. Even if you’re a small freelancer working from home, you never know when one of your clients will claim that your error caused them injury. You also never know what could happen in the future as far as your ability to earn goes. For instance, you could get insurance to cover you if you suddenly become invalid. This is something that not enough small business owners and independent workers think about, but it should be a priority.
Property Insurance is for Business Premises Only
Another related myth is that commercial property insurance is only for businesses that operate from an outside office or factory. But commercial property insurance covers any place of business, whether it’s a dedicated space or your house. You should also know that “property” doesn’t mean real estate here. Still, any possessions you may have that are being used to conduct business. So property insurance will cover your equipment and things like inventory and tools no matter where they’re being used or where they’re located.
Only Medical Professionals Need Malpractice Insurance
Malpractice is a term that people often misunderstand. They often assume that malpractice only happens in the medical field when it can happen in various other industries as well. Malpractice coverage is only one aspect of Errors and Omissions insurance. E&O insurance will cover your legal fees in case someone accuses you of giving them harmful advice or if you cause injury because of negligence.
This could be as simple as you make an error causing additional damage to something you were repairing. An accountant could also be accused of malpractice if they omit something or make an error that gets their client audited. So, don’t assume that only doctors need this type of coverage, as pretty much anyone that works with the public is likely to need it.
Home Insurance Will Cover My Home-Based Business
This myth is also not true. Insurance companies see businesses and homes as two completely different entities and they should both deal with different levels of risk. So, if you try to file a business claim through your home insurance, there’s a good chance that it will get rejected or that you’ll get limited coverage.
Forget these myths if you are searching for commercial insurance and ask the real questions before you even think of signing up. This is very serious and could have a major impact on the future of your business, so learn as much about it as you can.