Does My Online Business Need Insurance?
Jun 30, 2019
Running a business can be stressful but also very rewarding with many ups and downs along the way.
Some of the experiences will be fun, such as creating a brand, seeing the fruits of your labour, and also building the team to work with.
Others elements such as buying insurance may seem like more of a nuisance rather than something that will add value to the business.
This occurs mainly in online businesses since it is elementary to think that you may not need insurance compared to someone selling clothes at a store in town.
The truth is, regardless of how or where you sell things, your business will be exposed to some liabilities.
It is therefore prudent to take care of that by taking out insurance cover as soon as possible.
So, when and why does an online store need insurance? Please continue reading for more details.
Does Home Insurance Cover Online Businesses?
It is quite natural for one to assume that their home insurance will cover their online business, but that is not the case.
Even though one is using their home desktop or laptop to conduct the online business, home insurance may not cover the equipment that is used for the company by default.
In some cases, one may be able to extend their home insurance to cover for their personal and business use.
However, this will be done in a specialist home insurance policy in which the finer details of the policy will need to be checked upon.
What Are the Potential Liabilities?
Many people conducting online businesses may not be aware of the liabilities that they have.
Some of them include injuries that may be caused by the sale of products such as jewellery or baby clothes or even food poisoning claims if you sell food online.
Also, some people may claim that they got an allergy from using your company’s products.
These are examples of things that may lead people to sue the online business even though the business owner may not have manufactured the products.
Some of the other liabilities that you may have are data loss or hacking or even the loss of stock in the warehouse.
When Should an Online Store Be Covered?
Once you start selling products to clients, that’s when you should get insurance cover.
This is because it will protect the business and the employees from any eventualities that may occur in the process.
It is best to protect the business rather than avoiding insurance and leaving yourself and the business exposed.
What Are the Types of Insurance That One Could Consider?
There are many different types of insurance policies on the market.
However, every business is different; hence, there are different policies for various companies. Examples of this include:
- Commercial General Liability – This protects the business against liabilities that involve bodily injuries, damage of property, and also advertising or personal injury.
- Worker’s Compensation – This protects the employees against any injuries incurred on the job and also the time off needed for them to recover.
- Cyber Liability – The business will be protected from ransomware expenses to business interruption costs and breach notification. It will protect you from cyber breaches and safeguard the data of clients.
Online businesses have gained a lot of popularity nowadays, and the opportunities for sellers are increasing rapidly.
Getting the right insurance for one’s business may be a daunting task, but it is worth it.
Not taking out an insurance policy could lead the business to suffer significant losses in case one or more clients sue the company.
It is for this reason that all online businesses should look at securing their future with the right type of business insurance.
For an obligation-free, competitive insurance quote, professional insurance advice or more information on how we can help you, please contact one of our expert consultants today on 1300 356 496 or send a message through our website
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