Today’s business owners face an ever-evolving set of challenges. Those challenges could lead you to seek out additional insurance policies so you’re covered in case those issues impact your bottom line.
Traditional business insurance policies only cover the basics like basic liability and property damage due to theft or certain natural disasters. However, you may want to evaluate the other risks that your business faces so you can be sure you’re covered. Especially in today’s changing business environment, there are a few additional policies that you might find interesting and helpful.
Small Business Insurance Plans
Here are a few of them to consider.
The number of cybersecurity breaches in the U.S. has grown rapidly in recent years. And these issues can lead to liability issues for businesses, especially if you collect personal, financial or other sensitive data from customers or other third parties.
These policies have evolved a bit over the years as the online landscape has changed. Previously, they mainly covered to cost of reaching out to those third parties. But now you can also find options that protect you against common financial threats.
Rebecca Towell, Vice President at Pan American Insurance Services, which is a Relation insurance company, said in an email interview with Small Business Trends, “When cyber-liability policies were first introduced, the focus of the coverage was to pay for “notification costs” Although this coverage is still important, small businesses are now under greater threat from wire transfer fraud and social engineering. Ransom and extortion (especially for small businesses) is the third most prevalent threat situation.”
Sexual Harassment Insurance
It’s also important to make sure your company is covered in case of any claims of sexual harassment, discrimination or other employment issues, especially in the “me too” era. Of course, preventing any behavior from team members that may be construed as inappropriate. But since you cannot control everyone’s behavior or perceptions, it may be smart to invest in coverage just in case.
Towell says, “Even with best efforts at prevention, sexual harassment claims are always a possibility. I always say, insurance isn’t just about what you do wrong, it is about what you get accused of doing. You should evaluate whether to add coverage extension through your Employment Practices Liability Insurance (EPLI) and Directors’ & Officers’ Liability Insurance (D&O) policies. EPLI insurance typically provides coverage for sexual harassment claims, as well as a range of other employee actions, such as: discrimination, wrongful termination, breach of employment contract, failure to promote, wrongful discipline, and wage per hour. This can be an important safeguard, but only about three percent of companies with fewer than 50 employees have it.”
The U.S. has seen historic flooding levels over the past decade. And 40 percent of businesses that face damage from natural disasters never reopen. Flooding isn’t covered under basic business or homeowners policies. Even if you don’t have a physical location, flood insurance may help you stay up and running in your home office if flooding impacts your area.
Towell says, “As the risk environment continues to evolve, the lines between business personal and business risks are blurring, and insurance that was once a nice to have has become a must-have.”
An umbrella policy can help you cover other liability issues that may not fit under another specific policy. This could include things like operating rental vehicles, libel or slander claims, or defamation of character issues. This can be an attractive option for businesses that may face added risks that aren’t specifically covered by other policies.
Towell explains, “Umbrella insurance, also known as excess personal liability insurance, historically has been reserved for the wealthy. Nevertheless, interest has grown with increased coverage affordability; now, umbrella insurance is a standard purchase for most middle-class insurance buyers who have a realistic understanding of their risks.”