Business risk is a big risk
Starting a business is in itself a big risk. Once you start your business, it opens the doors for potential risks that most small and medium sized business owners either overlook or are unable to gauge their severity and future impact. Hence, it is always better to have business insurance in place to mitigate different types of risks that your business might be prone to. Depending on the requirement of your business, you can choose from the business insurance types that mitigate your business risks.
Business Insurance types
Requirement of business insurance types vary from one business to another. The most common types of insurance policies for businesses include:
- Property Insurance
- Liability Insurance cover
- Other Coverage
- Optional Coverage
These are all a part of business owner policies or BOP. Are you wondering what risks your business is protected from in other coverage and optional coverage? These are business insurance types that will offer protection from several future and unseen risks. Let’s take them one at a time.
Other Coverage
Other coverage consists of business insurance types or sub-types like business interruption insurance and extra expense insurance. Business interruption insurance will cover the business premise or building or property, important business equipments, standard perils to business property like fire, storm, explosion, or any similar peril. Although business interruption insurance is included within a BOP (Business Owner’s Policy), it can also be bought separately and even as an endorsement to a business fire policy.
The second business insurance types in other coverage is the extra expense insurance, which primarily provides coverage to any small business that continues to operate in spite of the damages caused to their property. There are some businesses that can quickly resume their operations while there are others that incur heavy expenses due to temporary relocation of the business facility, leasing or buying of new or replacement equipments and supplies, and much more. In such a scenario, the extra expense insurance cover will provide for the extra costs of resuming a business.
Optional Coverage
Optional coverage policies consist mainly of business insurance types or sub-types that cover both property and liability. Some of the critical elements or aspects of a business covered under these policies include:
- Outdoor signs: advertising signs attached to the business property or building
- Exterior grade floor glass: This refers to the glass at the ground level that is exposed to the exteriors.
- Money and securities: This refers to all-risk cover of valuables within the business premises or even in the bank.
- Crime insurance: This business insurance types offers coverage against theft and burglary within business premises.
- Mechanical breakdown: This types of cover provides protection from any type of mechanical breakdown of machines used by the business.