Insurance

Definition: Protection against loss for which you pay a certain sum periodically in exchange for a guarantee that you'll be compensated under stipulated conditions for any specified loss by fire, accident, death, etc

Let's face it: Starting and running any type of business has risks. Recognizing the risks in all areas of your business--management, marketing, contracts, personnel and the particular ramifications of your product or service on customers and the market--is the first step in effective risk management.

One of the smartest moves any business owner can make is having enough of the right kinds of insurance. Not only does this protect your business's assets from risks that could very well reduce them to nothing if a catastrophe struck, it also safeguards your personal assets, which are often on the line, from a liability point of view.

What kind of risks should you be concerned about? If you have employees, you're obligated to:

• Provide a safe place to work,
• Employ individuals reasonably competent to carry out
• Warn employees of danger,
• Furnish appropriate and safe tools, and
• Set up and enforce proper rules of employee conduct as they relate to safe working procedures.

You also owe a degree of safety and concern to your customers, clients, and the public--not only for their physical well-being when they're doing business with you but also to protect their property.

The basic business insurance package (not including health insurance) consists of four fundamental coverages--workers' compensation, general liability, auto and property/casualty--plus an added layer of protection over those, often called an umbrella policy. In addition to these basic needs, you should also consider purchasing business interruption coverage and life and disability insurance.