[Updated February 5, 2022]
As a business owner in Nigeria, you are susceptible to peculiar risks and unforeseen uncertainties that can make your business suffer loss at any time. However, having business insurance ensures you make hay while the sunshine and effectively manage risks out of your control. This article discusses business insurance, its importance, and the types of insurance every business needs.
What is Business Insurance?
Business insurance protects businesses from losses, damage, and risks due to unforeseen events. There are many types of insurance for businesses, such as coverage for property damage, company vehicles, contract disputes, legal liability, and employee-related risks.
What is the Importance of Insurance to Business?
Here are six ways insurance is important to business:
1. Employee protection
Workers’ compensation insurance ensures that if your employees suffer work-related injuries or die, they get benefits such as medical care, missed wages, and funeral benefits.
2. Customer protection
You can cover your customers if you have a Business Owner’s Policy (BOP). For instance, if one of your customers falls and breaks a leg, your BOP can help pay for their medical costs. Data breach insurance also protects your organization and customers in the event of a security breach.
Having the right insurance policies shows your customers and stakeholders that you take risks seriously. It also creates the perception that you will provide appropriate protection in an unfortunate occurrence.
4. Contract requirements
Your organization may need to get contracts that require insurance protection. Such contracts can be loan agreements, clients agreements, etc.
5. Attract the right employees
Most of the best employees look for more than just a salary as they search for jobs. They want more benefits, like life and health insurance. Workplaces without insurance will fail to attract these types of employees.
6. Legal protection
Another reason you need business insurance is to cover the costs of lawsuits if you get sued. For example, if an injured employee sues you, your workers’ compensation insurance can cover the legal fees.
Types of Business Insurance
Here are three types of business insurance:
1. Workers’ Compensation Insurance
This covers medical treatment, disability, and death benefits if an employee gets injured, disabled, or dies in his work. Even for low-risk jobs, a simple slip and fall injury to an employee can lead to something bigger and then cause a drop in finance for the business.
2. Auto Insurance or Vehicle Insurance
Transportation will always come with risks. It could be from the motorist or others on the road. If a company uses vehicles, they should be insured to protect against financial loss from road accidents with third-party or comprehensive auto insurance.
3. Property Insurance
A company, whether it owns or leases its space, needs to have property insurance. This insurance covers equipment, signage, inventory, and furniture in the event of a fire, theft, and other damages.
Grow Your Business With Insurance
Though these insurance covers are necessary, getting them can sometimes be complicated. This is where Leadway Business Owners’ Support Scheme (LBOSS) comes in.
Here at Leadway, our LBOSS cover puts all these individual business insurance covers in one plan to make the process easier and affordable. The LBOSS plan also covers more than one business for multiple business owners.
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