Business insurance, especially for small medium enterprises (SME) is one that has often been misjudged time and again. With too much misinformation about SME insurance out there, it is always easier to just believe it than seek out the truth about the importance of having business insurance.
Unlike personal insurance, business insurance may seem a little confusing and challenging to business owners who have little to no understanding about it. Most business owners choose to opt-out of having business insurance because they don't see it as a necessity. However, business insurance is crucial to protect businesses from unforeseen circumstances.
That said, here are the top five most common myths about business insurance that must be debunked;
Myth #1 – Insurance is not a necessity for small businesses
Unlike personal insurance, business insurance may seem a little confusing and challenging to business owners who have little to no understanding about it. Most business owners choose to opt-out of having business insurance because they don't see it as a necessity. However, business insurance is crucial to protect businesses from unforeseen circumstances.
That said, here are the top five most common myths about business insurance that must be debunked;
Myth #1 – Insurance is not a necessity for small businesses
This is a very dangerous assumption to make because no business is too small or too big for insurance coverage. When it comes to risks like fire, theft or flood, these perils do not choose their victims based on size; it can happen to anyone when least expected. Even with a small inventory or asset, a fire is fully capable of destroying it and everything you have worked for. This is why it is even more crucial for smaller businesses to get sufficient insurance coverage because they cannot afford to have their invested savings all wiped out by a fire with no insurance payout to help them restart.
Myth #2 – A home insurance covers home-based businesses
Insurers do not consider home and business insurance under the same category, even though your business is home-based. They are two separate entities and should be treated as such. For example, if a flood or fire damages business assets or equipment, general home insurance will void the claim because those items are not insured under the home insurance. With a separate business insurance, it will specifically protect your assets, equipment and any other losses related to your business. There is also a misconception that business insurance only covers things like the business premises or other big machineries. However, this is not the case as believing it will potentially cause you and your business an even greater loss in future.
Myth #3 – Business insurance will burn unnecessary holes in pockets
This is not true as business insurance can actually be really affordable. Business insurance comes in many different options and prices that can normally be catered to suit your business. It is actually a small price to pay in return for safeguarding a business that was literally built with your blood, sweat and tears. Let’s reassess this in a different light, if you think that business insurance is expensive then what about the mounting cost for extensive repairs, replacement of damaged equipment, lawsuits, accidents and so on? Weigh it and you will realise that getting business insurance is worth it.
Myth #4 – Having legal protection for businesses is a waste
You must be thinking, “why would I need legal protection for my business if the chances of getting into legal trouble or being sued is very slim”. The truth is, when dealing with people, conflicts and disputes are bound to happen and when it blows up, chances are legal action might be taken – either by own employees or customers. To safeguard your business, legal protection is needed as this gives business owners an added protection against financial losses from any potential lawsuits. Business owners can also put their mind at ease knowing that they would have the best legal consultancy services at their disposal.
Myth #5 – A company of only one worker can forgo a business insurance
Be it one, five or fifty workers in a company, business insurance is still necessary even if it is just for a party of one and it does a lot more than just disburse claims when an unfortunate incident happens. A business insurance also shows others how serious and legitimate your small company is. It will also give other bigger companies a sense of confidence and reliability when going into a partnership or business deal. Business insurance is also important for specialised companies that are engaged in risky business such as construction for example, and it can ensure proper and sufficient coverage even if it is only for one person.
One good insurance platform that has all your business insurance needs covered is Liberty Insurance, with its BizCare package. It is a holistic business insurance plan tailored to cover every SME business’ needs. This comprehensive package provides coverage for fire, business interruption (due to fire consequential loss), accidental risk (limited all risk), burglary, public liability, employer liability, fidelity guarantee, money, plate glass, terrorism and group personal accident.
As Liberty Insurance truly cares about protecting businesses and its customers, the company has recently introduced its enhanced BizCare policy that includes a new Flexi Plan. This plan allows business owners to pick and choose only those cover required for their business and customised to their own choice allowing flexibility in premium matching cover.
Under Liberty Insurance’s BizCare policy, it also has Legal Shield, a benefit that provides businesses with access to legal advice. It not only covers legal disputes with third parties such as customers or other companies, but also with current and ex-employees. Legal Shield aims to shield businesses from facing the full brunt of the law and its high costs.
