Running your own small business is tough—dealing with the aftermath of a loss can make things even tougher. But that’s why we’re here: to drop some knowledge on common claims you and your business should be aware of, so you can prevent a loss before it happens. No matter what kind of business owner you are, there’s always a chance that your business could get damaged. Here are some common claims you should safeguard your business from to prevent a potentially expensive loss.
Damage to your vehicle
One aspect of your business may involve you using your personal vehicle, whether it’s delivering goods to customers or visiting clients. If you get into a car accident, you might think that your personal auto insurance will cover you for damages. Unfortunately, your personal auto insurance won’t cover you in certain situations. To figure out what’s best for your business, answer the following questions:
- Do you use your personal vehicle to visit clients or transport customers?
- Do you transport business equipment or deliver goods and merchandise in your personal vehicle on a regular basis?
- If you have employees, do they drive your personal vehicle for work-related purposes?
- Do you have any marketing or advertisements on the outside of your vehicle promoting your company?
If you answered yes to any of these questions, then you should consider getting commercial auto policy for your business, as you’ll need the extra coverage in the event of an accident. There are a few key differences between personal auto insurance policies and commercial auto insurance policies that could open the floodgates of your business’ bank account. Without a commercial auto insurance policy to protect you, you could personally be on the hook for the repair or replacement costs.
For example, let’s say you’re driving from one jobsite to another and you have your equipment stored in the back seat of your car. If you get involved in a fender bender, you may not be covered by your personal auto policy, as you are using your vehicle for business purposes. Depending on what you’re transporting – and the extent of the damage caused by the accident—things could get expensive. Getting commercial auto insurance can help you avoid these costly scenarios.
Here’s an interesting fact: if your car has any sort of advertising on the outside promoting your business, you need commercial auto insurance to cover your vehicle in the event of an accident. Yes, this means that even Scooby-Doo, Shaggy, and the whole gang at Mystery Inc. need commercial auto insurance to properly cover the Mystery Machine.
Damage to a customer’s property
Picture this scenario: You run a catering company, and you and your employees are working at a customer’s office Christmas party. With the cold winds blowing outside, you decide that some fresh chili would be a great way to warm everyone up. You’ve spent all afternoon cooking it and are excited to serve it. Unfortunately, on the way inside, one of your employees trips and spills the entire pot of chili. Not only is your customer and the entire office hangry, but the floors and walls have been badly stained, and no amount of Mr. Clean will be able to fix the damages quickly. To recuperate the costs, your customer decides to file a property liability lawsuit against your business.
Regardless of the job you do, if you’re found legally liable for damages made to the customer’s property, you could face costly legal expenses. This can also have a negative impact on your reputation with current and future clients. Commercial general liability insurance, or CGL insurance, is designed to help mitigate the costs that may be associated if your business is found liable for property damage to a third party, either on or off your premises.
There are also scenarios where you’re required to have proof of CGL insurance in order to work. If your business participates in tradeshows or markets, the venue will often request that you provide a certificate of liability coverage. This is to ensure that, in the event that the venue is damaged, your insurance will cover the costs of repair. With your CGL insurance in place, you won’t need to worry about spilt chili in the future.
Damage to your own business property
Whether you’ve set up your business in a building around the corner or right in your very own home, you might think that your business is an impenetrable fortress. Your business, however, may not be as invincible as you think. In fact, it could be vulnerable to the elements, especially water. Canada’s spring and summer in 2017 saw a great deal of rainfall, and as a result, a great deal of flooding. In Quebec more than 130 municipalities and 1,400 residents were affected or threatened by rising water levels. Furthermore, the Parliamentary Budget Office(PBO) estimates that storms, hurricanes and floods linked to climate change will cost the federal disaster fund $900 million annually over the coming five years.
The lack of awareness and preparedness for flood damage can sometimes be more harmful than the floods themselves. One study found that 94% of Canadians living in areas with a high risk of flooding were unaware they were even at risk. Business owners like yourself should be readily prepared, as the average cost of flooding in a major urban city in Canada is $42,000.
Suffering from a flood can be a traumatic experience, and the longer it takes to get back on your feet, the worse the experience can become. If your business gets hit by a flood, your commercial property policy can help with the repair costs and get your business up-and-running quickly. If the flood causes damage that is too extensive for repairs, commercial property insurance can often help with the replacement costs for your business contents, including equipment and inventory. Make sure you have the right insurance coverage to mitigate these costs if you ever experience a flood.
Leave those damages in the dust
The truth is, running your own small business isn’t always easy, but it can be incredibly rewarding. Being aware of the risks your business faces day-to-day can help you better prepare and avoid a potentially devastating loss.
Ensuring you have the right coverage to protect your business is another key piece to the small business puzzle. Commercial auto insurance CGL insurance, and commercial property insurance, and are just a few examples of how TruShield can help keep you protected from risk.
This blog is provided for information only and is not a substitute for professional advice. We make no representations or warranties regarding the accuracy or completeness of the information and will not be responsible for any loss arising out of reliance on the information. Terms, conditions and exclusions apply to coverage. See policy for details.