The term commercial insurance is a term that you are most likely to have come across. While it is a common term in the insurance industry, quite a considerable number of people are yet to comprehend what it truly is. So what is commercial insurance?
What is commercial insurance?
Commercial insurance is insurance that covers businesses from losses that may arise from injury to employees or damage to business property. Commercial insurance is often a general term that encompasses a lot of policies. It consists of policies such as employer’s liability, professional indemnity and public liability. These are the major covers. Different businesses may often need different covers depending on the risks each bear or legal requirements for operating in certain jurisdictions among other reasons. Besides the common covers at Procom Insurance Company, there are different more specialized covers of commercial insurance. These covers are stock insurance and business building insurance among others.
Why does a business need commercial insurance?
Businesses often need commercial insurance owing to the various risks each is prone to and the benefits of having one. Here are the common reasons why a business may need commercial insurance.
1. It is a legal requirement to have one.
Businesses operating in certain jurisdictions are required by law to have different covers. Different states have different cover requirements. Failure to have such covers is illegal and can have serious legal consequences.
2. Protects your business from losses.
Businesses are prone to different risks. In the unfortunate event that the risk occurs, the damages incurred can be quite costly and the ability of the business owner to cater for damages can be difficult. However, a commercial insurance protects you from such. In the event that the covered incident occurs, the insurer will pay for the damages incurred. The cover can also protect your employees from injuries that they may get while at work. Personally catering for treatment or the compensation can be quite costly but having a policy for them should prove useful in settling any settlements that may arise from injuries at work.
3. It improves the image of your business.
Having a commercial insurance can help boost your image. It shows the various stakeholders that you are safe bet. Their interests are safe when they get involved with you since they know you can compensate them in case of any losses or damages. Having a commercial insurance can also help you attract the best employees. This is because they know that by working in your firm then they will be covered against risks in the work place.
4. It ensures continuity.ln the event that a business incurs losses or damages from the various risks it is prone to, starting over can prove quite costly because of the costly losses and the capital needed for a fresh start. However, if the business was insured then the insurer will pay for losses which will enable a fresh start or pay enough to fix damages incurred.
Businesses often incur damages and losses from common risks. These can befall anyone hence it is vital to ensure that you have a policy that covers such risks that may often lead to damages and losses. Commercial insurance is ideal since it will ensure you are covered from most of these risks.