Myth 1: The Cost of Insurance Outweighs Its Benefits
Reading up on different insurance policies and figuring out the cost of each may seem especially intimidating to a beginner. However, calculations such as these are necessary to understand expenses. Premiums are required for all kinds of business insurance and may seem pricey when added up. However, the cost of premiums is likely far lower than any cost you would incur without insurance. For example, paying out of pocket to cover damages to company property or employees would probably rack up a far larger bill than paying for premiums. Insurance companies exist to protect businesses from having to pay too much in the first place. Therefore, it makes little sense to charge premiums higher than the potential cost from damages.
Myth 2: One Policy Covers Everything
Broad assumptions such as this one can be scary for business owners and insurance companies alike. Often, business owners may believe that a general liability policy covers just about everything they need. However, understanding exactly what kind of business insurance is offered by your insurance company and what the policy entails is vital. For example, general liability insurance may cover work incidents that occur on business property, but it may exclude incidents that occur on the road and in other locations. It’s often smart to ask questions before purchasing a policy. Many insurance companies are willing to offer alternatives and are transparent about the options they have.
Myth 3: My Business Is Already Covered
If you are looking to own a franchise or business that is affiliated with a larger corporation, you should understand that many such businesses are not always covered with company insurance. Instead, you may have to purchase insurance yourself. While some business owners may be covered under a corporate policy, there is a difference between personal and business coverage. A brief investigation can help you clarify this difference and save your business from the assumption that it’s already covered. This particular myth is frightening because it can give business owners false hope. It’s important to always research what policies are or are not in place for your business.
Business insurance can be scary enough to invoke the same fear a celebrity’s turbulent dating history does in some people. Both have their own sets of misconceptions, and in both cases the solution is just to do some simple research. In terms of insurance, all you have to do is take a little time to investigate what you want and need in a policy. Knowing the details is half the battle, and most things seem less scary once you understand them better.
