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Do I Need Business Insurance?

Is business insurance really necessary? If so, what types of insurance might I need? These are two questions business owners often ask, especially if they are just starting out. Business insurance can seem like an unnecessary expense, especially when things are financially tight and profits are small or non-existent. We think this issue is an important one to address though, and that’s what we’re focusing on today.

11 Reasons to Say Yes to Business Insurance

We’re not insurance advisers; we’re accountants, bookkeepers and business consultants. What we do know though, is that the benefits of having business insurance provides are well worth the expense. Here are 11 reasons why you should say yes to insurance for your business:

  1. Some contracts, such as entering into a contract for a lease on a business site or a loan with a bank or financial institution require business insurance.
  2. Most trade shows require exhibitors to be insured.
  3. Financial protection for natural disasters such as flooding or fire, as home policies most likely won’t cover any business-related property or tasks.
  4. To protect against harm to property or person.
  5. Keeps your business going financially if something unforeseen is to occur.
  6. Assist with costs needed to correct any cyber crime harm.
  7. Cover from employee theft and damage.
  8. Stock protection and replacement.
  9. Protect your business from high litigation costs should you get sued.
  10. Business insurance is a tax deductible expense.
  11. Gives peace of mind that if something happens, you will not suffer financially.

Next, we’ll discuss the many types of business insurance, helping you decide which ones your business needs.

8 Types of Business Insurance to Consider

There are eight types of insurance you should consider for your business. They are:

  • Business asset insurance, which covers property, buildings, machinery, office equipment
  • Business interruption insurance to cover for acts such as flood, theft to cover loss of income and employees’ wages
  • Key person insurance, especially in a small business this can be very important as it may rely on one or few staff to run it
  • Vehicle cover for company cars
  • Professional indemnity insurance, especially when you are offering a service like professional advice or consultancy.
  • Public indemnity insurance protects against damage to public property by you or your employees
  • Statutory liability insurance for protection against unintentional breaches of NZ law
  • Cyber insurance, for loss or damage to data

Business insurance is a small expense which brings great peace of mind to business owners. While it is something we strongly recommend, we suggest chatting with a business insurance advisor for personalised advice to meet your own requirements before making any decisions. Not really sure where to start or who to talk to? Get in touch with the team at MBP and we ca help point you in the right direction.

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