A business plan built solely on the “best case scenario” is like a house of cards—one gust of wind (or fire or wrongful termination legal action) and the entire business can come crashing down. That’s why smart small business owners assess and manage their risk.
The first step in implementing a comprehensive risk management plan is identifying potential risks. To help you get started, we have provided a list of the top 10 threats facing small business owners. Here are 5 to get you started and we will look at another 5 next week:
- Protecting your Property
Property holdings are often a small business owner’s largest asset. Therefore, it is vital that you evaluate potential threats to your property and develop a plan to manage those threats. Begin by taking a complete inventory of all your assets to determine how a loss might affect your business and how much cover you need. Property cover can come in many forms to suit your specific needs, but a typical policy will provide the replacement cost value for your building and the actual cash value for your business property. You should speak to an expert in business property insurance to get you the right cover. A-Plan’s commercial team can help.
- Business Interruption
If a fire causes the facility to be temporarily unusable, what would you do? Ideally, you would move to a temporary location while your permanent place of business is being repaired, but traditional property insurance does not cover this move or the loss of income while the permanent business location is being repaired. To mitigate this risk, consider adding business interruption cover to your property insurance policy.
- Liability Losses
No matter how well you plan, running a small business can be fraught with unexpected surprises. Smart business owners protect their assets by carrying adequate public and products liability insurance cover.
- Key Person Losses
Many small businesses are built around the talents and expertise of a few individuals. If an employee crucial to the functioning of your business departs unexpectedly due to death or injury, would day-to-day operations continue as usual or would disorder and uncertainty ensue? Key person insurance can help you answer these questions with confidence. This cover is designed to provide financial stability in a time of stress and uncertainty, allowing you to keep your business moving forward.
- Injuries to Employees
Small business owners often do not realise the full effect workplace accidents have on their organisation. Beyond initial treatment costs and lost production time, on-the-job injuries might have an impact on insurance premiums, which can increase your costs for years to come. Having the proper pre- and post-accident procedures in place can reduce your employers’ liability exposure, and implementing a comprehensive safety programme can reduce the accident rate. Contact A-Plan’s commercial team to learn more.