If you have recently started business, your view of insurance may be that it is a luxury, which can be afforded by big, thriving companies to purchase it.
You also feel it is not necessary right now because you have tight cash flows, you have employees to pay, and you need to market your product. So you will be thinking, “If I get robbed or my things like old truck gets stolen, I’ll deal with it at that time. I’d significantly spend money dealing with what I know will happen, rather than what could happen.”
The way of thinking like insurance is protection only against casualties like accidents or losses need to be changed. In fact, the most significant reason you may need insurance is for protection from legal hazards or risks. If you understand how insurance is essential to your business, you will be in a better position to select the types of insurance you need and to determine how much insurance you need.
If an uninsured loss hits a business like accidental destruction of the business’s computer system, or a lawsuit based on a “slip-and-fall” that occurred on the business premises, the business’s owner could be influenced in two ways. First is loss may reduce the profits, second is owner may have legal responsibility to others to pay for the business’s loss. So, in order to lessen the burden of owner at the time of accidents, business need to be essentially insured.
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