-It’s a fact that insurance is necessary for operating a successful business. “Insurance is a smart practice because it protects the business and workers compensation and auto insurance are required.” said Rick Torres from the Solvang RW Torres Insurance Agency, when announcing his recently released “Business Insurance Options for Startups.”
It’s easy to put some decisions on the back burner during the excitement, expenses and stress of starting up a new business, but insurance is not one of those things to delay. Insurance protects the business and the owner’s personal assets and the future of the owner’s family. Even when starting a home-based business, things can happen that expose a business to financial liability. It’s wise to start off on the right foot and insurance is part of the first step.
While it’s important to keep any eye on the bottom line at any phase of growing a business, some of the seemingly innocent shortcuts can open the door to problems later. One of the more common ways the owner of a small business cuts economic corners is in business auto insurance. The owner uses his or her personal vehicle for business a few times a week because there’s no need, yet, for a dedicated business vehicle. “The small amount of money you might save by not being upfront about using your private vehicle for business puts you at risk of losing auto insurance,” said the Solvang insurance agent.
The insurance company can refuse to pay the claim if a private vehicle was involved in an accident related to doing business. In fact, the insurance company can choose to cancel the entire policy, which makes it difficult to get affordable coverage in the future.
Along with making sure private vehicles are covered for business-related trips, such as delivering merchandise, driving to a business meeting, or picking up supplies, other types of business insurance include:
- Professional and commercial liability to help survive legal actions claiming negligence or errors or omissions.
- Insurance that protects the business from common causes of loss.
- Disability insurance that covers income when an employee or partner is injured or sick.
- Life insurance for owners, partners and other key employees to help keep the business running in the event key staff members die
- Worker’s compensation, required by law in California, helps protect employees and employers from the cost of workplace injuries.
- Employment practices liability helps protect a business from the legal costs resulting from allegations of discrimination, wrongful termination, or sexual harassment.
- “As soon as the business can afford to buy or lease a vehicle, get business auto insurance,” said the Solvang auto insurance
One of the first things to do before starting a business is to sit down with your insurance agent and analyze insurance needs from startup through the growth expectations in the business plan. Discussing the business financial projections helps make sure the business is protected every step of the way. It’s important to work with an agent who can make sure the business has the right insurance with the flexibility to meet all the business needs.
The agents at the RW Torres Insurance Agency can make sure all of the most flexible State Farm business and personal insurance coverage is provided for maximum protection.
Other insurance coverage can include group life insurance and group medical insurance and Completed Operations Liability that protects against legal costs due to injury or property damage after a project has been completed.
Starting a business can be a big risk and an economic challenge. One of the first things on the list is to sit down with your insurance agent and analyze your business, including the type of business, growth projections and financial projections to be sure you are adequately protected every step of the way. It’s important to work with an agent who can help make sure you have the right insurance plans with the flexibility to scale with your business. Flexible insurance that is easily scaled from start-up through the various stages of growth is cost-effective.
RW Torres Insurance Agency Inc
540 Alisal Road, Suite 4
Solvang, CA 93463-2637