Deciding that it's time to buy Business Insurance

By Compuquotes Team on March 27th, 2008
Business Insurance

Buying business insurance can be a major step for any business owner to take, and most try to put off the purchase for as long as possible in order to avoid the expense. There comes a time when business insurance becomes almost a necessity, however, and being able to recognize that time can help business owners to get the benefits of having business insurance without the drawbacks and financial hassles of buying it too early. Consider some of the following information if you're trying to choose whether or not it's time for you to buy business insurance so that you'll be able to more accurately determine whether your business is ready for it.

Growth of your business

As your business becomes more popular you'll have to serve more customers or clients and will be facing an increased pressure to prove that your business is secure. The growth of your business can mean many things, including more inventory and more risks associated with maintaining your business. When you're considering buying business insurance one of the first things that you should think about is whether your business is growing at a rapid rate, because the faster your business is growing then the more likely it will be that you'll need insurance soon if you don't need it already.

Likelihood of loss or damage

Another big concern is that as your business gets bigger you're going to have an increased chance of loss, theft, or other damages. Business insurance can protect you and your business from having to take a financial hit for lost or damaged inventory, and can also protect you in case of major damage to your business location. If you don't maintain an inventory or you work freelance from home or otherwise don't have a physical business location then business insurance obviously won't provide this protection for you. If you do have inventory or a large investment in a physical business location, however, then the more popular your business becomes the more at risk of loss you will be.

Seeking additional business funds

If you're looking to make a major expansion in your business, you're going to need to have the money to do it. This usually means that you've got to either borrow money from a bank or other lender, or at the very least find additional investors for your business. Most lenders and investors will require that you have business insurance to help protect their money from loss, and will usually be much more likely to give you the money that you request if you're already insured when you present your business plans to them.

Amount of liability

The more employees and customers you have on your business premises, the more potential liability you're going to have in case of any accidents. By purchasing business insurance you can make sure that this liability is covered. While it's understandable that you won't want to buy potentially expensive insurance until you're sure that it's needed, being faced with a liability suit without insurance can bankrupt your business or at least leave it financially crippled.

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