Understanding Different Types of Insurance

The threats your business faces today are constantly evolving. From financial risk, cyber-security and data breaches to issues of liability with customers, the stakes continue to rise. As we begin a new year, it’s a good time to review your current business insurance policy and consider adding coverage to help protect what you’ve worked so hard to build.

To help you understand what you need, we’ve compiled a list of some key types of business insurance coverages below.

Commercial General Liability Insurance

The term liability refers to a situation where your business is found to be responsible for third-party damages in the eyes of the law.

Commercial General Liability (CGL) insurance is the foundation of any business policy. It is designed to respond to situations where your business is legally liable for the following damages caused to a third-party entity:

• Bodily injury
• Property damage

Regardless of your industry, this type of business insurance is critical because there’s always a risk of being held liable should something go wrong and cause a third party to suffer a loss. For example, if someone slips or falls and hurts themselves while on your property, you could be held responsible for those injuries.

Commercial Property Insurance

This type of coverage specifically protects your property. This can include things like tools and equipment, stock, supplies and even your building.

Should you suffer a covered loss, here are some of the ways why you could benefit from having commercial property insurance:

1. Recovery – This coverage can help get your business back on its feet as soon as possible after you suffer a covered property loss.
2. Repair costs – Can assist with the costs of any necessary repairs to get you back in business quickly.
3. Replacement costs – Commercial property insurance can often assist with replacing any damaged property that can no longer be repaired.
4. Unexpected losses – No matter how much you prepare your business for the risks it faces, sometimes unexpected losses still happen. Examples include a loss resulting from fire, winter weather, a flood, an earthquake or theft of property you own. Ensure that your commercial property insurance can respond to these loss situations.

Keep in mind that the cost of your policy could be affected by different factors including:

• Location
• Replacement Costs
• The type and age of the electrical plumbing at your insured location

Business Interruption Insurance

Picture this: you’re a manufacturer who creates your own products and someone breaks into your business, stealing all the necessary equipment to produce your goods. Because of this, you need some time to replace your equipment to get back up and running.

But what will happen while your business is temporarily shut down? Should you suffer a covered loss at your business location that requires your business to be closed temporarily for extensive repairs, business interruption insurance can help to pay for your loss or reduction in business income.

Commercial Auto Insurance

Do your business operations depend on the regular use of a vehicle? If so, you need commercial auto insurance which not only protects your vehicles but your employees and your bottom line should you suffer a covered loss.

Some questions to ask yourself when looking for coverage:

• Who owns and/or operates the vehicle/s?
• What are the vehicles used for an how often are they used?
• What types of vehicles are involved?

It’s important to note that your personal auto insurance may not provide coverage or may provide inadequate coverage for your vehicles used in business operations.

Cyber Risk Insurance

According to the Canadian Internet Registration Authority, 40 per cent of Canadians surveyed in 2018 experienced a cyber-attack. That number jumps to 66 per cent for large businesses with 250-499 employees. Examples of cyber-attacks include:

• A targeted phishing scheme via email
• Viruses unleashed on your network to steal confidential data

A cyber-attack can impact your business’ operations and can lead to lost or stolen documents.

A solid cyber risk policy can offer:

• First party coverage to help protect your business from some of the costs that directly impact it as a result of a covered loss
• Third party coverage to help protect your business from some of the costs that third parties, such as your customers or suppliers, incurred because of a covered cyber loss that your business suffered
• Coverage for data stored anywhere in the world

Many business owners believe this coverage is part of their commercial general liability or their commercial property coverage form, however this is not the case.

Make sure your business is protected

Having the right insurance coverage is critical, and at TruShield, we work to ensure businesses like yours have the insurance coverage they need.  Whether you work with cars, equipment or food, find out which coverages are helpful for your business and specific industry today!

 

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.