5 Mistakes Small Businesses Make When Getting Insurance

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One of the most complicated aspects of starting a small business can be the myriad of insurances that are available, and in some cases necessary, for the owner to have. From liability insurance to casualty insurance to property insurance to employee health insurance, deciding exactly what coverage you need can be a truly daunting task. If you’re getting ready to start a business, or wondering if your business is on the right track when it comes to insurance, take a look at these five common mistakes small business owners make:

Not Buying Insurance
This is the first mistake on the list, as quite obviously the worst mistake you can make when deciding on insurance is to decide that you don’t need it. When you’re uninsured, you are literally a single accident or lawsuit away from complete devastation. Even if, in a best case scenario,  you are sued and eventually win, the cost of defending yourself will more than likely be too much to handle on your own.

Failing To Compare Companies
As the owner of your business, it’s your responsibility to find not only the best rate, but also the best service for your business and your employees. Do plenty of research to find the company that is going to offer the best price while still maintaining a level of service that will ensure your claims will be processed quickly and correctly.

Messing Up The Paperwork
Paperwork is a necessary evil, and not filling out paperwork accurately and completely can leave you vulnerable to a host of problems. There’s certainly no need to give anyone a reason to deny your insurance claims, so make sure that all paperwork is filled out correctly and filed on time. In addition, whenever your situation changes in a way that may affect your coverage, make sure you notify the correct people, in advance if possible.

Having The Wrong Insurance
You need to ensure that you are adequately covered for any situation that may arise, and that means obtaining the right types of insurance. You may be covered for accidents, but what happens when you get sued, or your building catches fire? It may seem like these scenarios won’t happen to you, but the saying “better safe than sorry” is especially applicable when the “sorry” scenario means you lose your business.

Providing Health Benefits
Health coverage has become a major concern for many now that the Affordable Health Care Act is in place. To see how this affects your business, check out the SBA’s guide to Health Care for Businesses. Your concerns (or your employee's concerns) about health coverage may be numerous, but your best course of action is, as with most things, to both educate yourself and also talk to an expert when making decisions.

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