Updated: Feb 3
Insurance is all about risk mitigation, not risk elimination. Risk is something that is always there. Without anticipating it, more than 40% of small businesses will see a property or liability loss within the next decade. Knowing this, the responsible question from any business owner is, “do I have sufficient coverage?” The most expensive claims usually happen the least often, catching many business owners by surprise. In fact, the more unimaginable the event commonly means the more severe the claim. Do you have enough coverage to sustain a costly loss? How can you even be ready for the “unimaginable” happening? The first step is to be aware of these rare yet costly occurrences. Most big disasters are rooted in a failure to imagine, but some people have experienced these disasters before, and you can learn a lot from them. Here are the three largest, and also least frequently occurring, business insurance claims covered, at least in part, under standard business liability and property policies: #1: Reputational Harm Copyright, libel, and slander are examples that top the chart in the average claim size of $50,000. Infringing on another entity’s rights can be expensive. A general liability policy provides basic coverage that most businesses need. Consult your business attorney or insurance agent to learn about the common legal pitfalls in this category that catch businesses by surprise, concerning only about 5% of all recent business claims. #2: Vehicular Accident The average price tag of $45,000 is associated with still less than 5% of insurance claims. In a post-pandemic world, we will probably see this fall further down the list in frequency with more people working from home. Still, at this size it is something to consider adding mitigation strategies and sufficient coverage so that you don’t worry about taking such a large hit against your business. #3: Product Liability and Fire Damage Nothing to turn your nose at, a $35,000 loss can hurt many small businesses, if not adequately covered. With each happening only less than 10% of the time, don’t get caught back on your heels forking all of this out of pocket. Call your agent to discuss the necessary preventive measures and coverage for each of these unforeseen events. Business insurance makes it so that you don’t have to imagine the worst; you can just focus on what you do and leave the disasters, the accidents, and the unimaginable to the insurance company. Choose an insurance company with exceptional customer service that can save you time, money, and effort when the unexpected strikes.
Call or email your insurance agent to see if you have enough coverage for when one of these most costly and unimaginable business disasters happen. You can’t fully prepare for whatever the world throws at you and your business, but your agent can mitigate and provide the extraordinary care needed so that you can keep your business on track.