Finding the right types of business insurance when drawing up your policy, can seem rather daunting when you start.
From finding what types of insurance you may need and how much cover your business requires, to the risks your business may need to anticipate, Bi-me makes the complicated process easier for you to manage and adjust in the future.
As a small business owner, you are well aware of all the details that go into running a business and having the surety of insurance will give you peace and allow you to focus on what’s important.
Asking the right questions can greatly help your task, and we’ve listed out the 5 main questions that small business owners and large companies alike should ask themselves when working out the best policy for their business insurance.
1. What potential risks are my business exposed to?
Ask yourself what possible risks your business may encounter every day, and what threats you may face in the future without business insurance.
What are the activities involved in your daily business operations, and should you consider the following aspects when planning for your business insurance:
- Do you interact with the public – how do you interact with your customers, such as within your premises?
- How does your business operate, such as is there a physical store or online operations?
- Does your business or employees provide specialised advice or professional services?
- How large is your team or staff contingent and do you use suppliers and outside services?
- Does your equipment have to be moved off-site to perform your services, and do you own any valuable equipment, tools, machinery, or supplies?
Once you’ve completely analysed your business operations and activities, you’ll be able to then think about the risks and liabilities of each aspect that will affect your business.
If you have equipment used off-site or valuable machinery at your premises, you can see the risks and determine that you will potentially need Portable Possessions insurance to cover the cost of any damaged or stolen tools and valuable goods. In addition, content insurance, more specifically plant & machinery insurance can be added as part of your cover if your machinery is within your premises.
Below, we’ve briefly listed the different types of business insurance you may need to include in your policy. It has been said to rather over-prepare than to regret – and many small business owners in South Africa are finding insurance to be the lifesaver it was designed to be.
2. What types of business insurance do I need to consider?
Depending on your business type and the services you provide, the types of cover you’ll need to include in your policy will vary.
Take a look at the types of business insurance listed below, which are typically included in small business owners’ insurance.
Professional Indemnity insurance
Professional Indemnity insurance is designed to protect you from claims, against you and your business, as a result of negligent acts or omissions in providing your professional services or advice.
This policy will also assist with the legal costs to respond and manage such claims.
These professions could include accountants, architects, consultants, and other types.
Examples of Professional Indemnity insurance claims:
- Providing the wrong treatment or diagnosis
- Wrong advice provided
- Misinterpretation/Miscalculation/Overestimation
Buildings insurance
Buildings Insurance is a form of business insurance that covers the cost of repairing or rebuilding your premises in the event of fires, storms, explosions, lightning damage, etc. This is especially important for those who work from their premises or rent them out.
Contents insurance
Contents Insurance is a type of business insurance that provides cover for the items inside your building. This includes office content, plants and machinery, stock and materials in trade, and miscellaneous items. Designed to protect the valuable assets of your business.
Public Liability insurance
Public Liability insurance is designed to protect you and your business in the event an employee, customer, or civilian, is injured or damaged their property due to negligent business activities.
This type of cover is one of the most common and most important insurance types, especially if your business deals with third parties, suppliers, and members of the public.
Accidental Damage insurance
Accidental Damage covers unintentional damage to your building or its contents. Accidental Damage provides protection for events not covered in the Buildings, Contents (fire, flood, storm, etc.) or Theft sections.
Business Interruption insurance
Business Interruption Insurance provides protection from a loss of income and increased costs, that are the result of an insured event (such as a fire, property damage, etc.)
Business Interruption is designed to assist your business in recovering from the loss of such an event and helps you by paying for ongoing expenses, such as wages or rent.
Portable Possessions insurance
Portable Possessions, also known as Business All Risks, is a type of business insurance that will provide cover for the loss or damage of your tools or work items.
Such items could include equipment, tools, laptops, and mobile phones. More unique items are also seen, such as art, gate motors, marquees, and musical instruments.
Theft insurance
Theft insurance covers your office contents, stock, machines and other items inside of your buildings for theft, attempted theft or armed hold-up. It is normal for theft insurance to require the stolen item to have been securely stored before the theft and for there to be evidence of forced entry.
3. How much cover will my business need to be fully insured?
Each business will need a different amount of cover, with different insurance types and the amount of cover you’ll need from each type will depend on your needs and business operations.
A legal aid company will have different needs than a florist, and each insurance type is tailored to suit the very many different occupations out there.
Here are a few factors to consider when trying to judge how much insurance cover your business will need:
- Add the cost of all your equipment and valuable items, and ask yourself how much it will cost to replace them if they are damaged or stolen. The total amount will probably be too much to cover and still manage the cost of your business – This is where insurance will allow your business to remain functioning and not allow any interruption to disable you.
- If you are ever required to appear in court, the cost of legal aid is staggering, let alone the possible business interruption this would cause. If your business is insured, these costs would not come from your personal finances.
- Working with contracts or memberships will often require you to have a minimum level of insurance in place, in order to undertake the contract work.
4. What terms will I need to consider when selecting a policy?
This is an important step in the process of insuring your business.
Each insurer/insurance company will have different terms and coverage for the different types they have to offer. It is of great importance to understand the conditions of the policy and ensure that all areas of your business are insured.
5. How do I properly buy business insurance?
It may feel like a silly question, but it is one of the most common questions we are asked.
Insuring a business is not something we are taught in life, and many insurance companies make the task difficult or seek to take advantage of the ignorance.
Finding the right quote for the best cover is crucial. There are many ways you can go about your research, but many small business owners don’t have the time to spend finding all the necessary information from numerous insurers. That’s where we step in for you.
At Bi-Me, we give you the control and help minimise the stress of finding quotes for the right types of cover your business will need. With easy comparisons and assistance with managing your insurance policy, we deal with all the moving pieces of business insurance and let you do what needs to be done – run your business.
The stress taken out of insuring your business.
We’ve taken away the complex forms and paperwork and moved the process online. Answer a few quick questions and you can receive multiple quotes within seconds.
Once you’ve compared policies and decided which one is right for you, you can buy immediately, online. You’ll be able to instantly access your policy documents whenever you need them. If you prefer to talk to a real person, our friendly team is here to help.
This is general information only and does not take into account your financial situation, needs, or specific objectives. As with any insurance, cover will be subject to the terms, conditions, and exclusions contained in the policy wording.