Business insurance might seem like a very contemporary part of the postmodern world, but it has been around for ages. In fact, the very first business-related insurance actually occurred even before the rise of Christianity. In the first century BC, some Chinese merchants had the great idea of protecting themselves from all those hassling shipping losses. They wanted to find a way to prevent incurring losses from the storms, harmful sea and voyage experiences, and pirates. In order to do that, they decided to divide their cargo among the different ship as the very first way of insuring themselves. This way, even if one ship sinks they will not lose all of their cargo.
Fast forward to a later time and place, and the history of insurance will take you to the Western world. Here, the British merchants were the first people who thought of setting up property insurance. They were able to develop a habit of passing through the entire day situated in a coffee house named Lloyd’s by the docks. Here, more and more merchants had dared to offer solutions to finance some hazardous trade voyages. This then prompted them to coin the term “underwrite”. This term described the method of financing, so in effect they became the very first insurance underwriters of the world.
When time passed, the underwrites developed their skill when it comes to predicting losses so that the insurance rates would become standardized. Pretty soon, individuals realized the need to form groups or companies that can provide them with the adequate protection they need for even large groups of people. As an official note, the very first kind of property insurance company was inaugurated in London in the year 1667 – the year after their city was almost wiped out due to a fire. Pretty soon, Benjamin Franklin ended up establishing the very first insurance company in 1752. In the New World, the group Philadelphia Contribusionship for the Insurance of Houses from Loss by Fire was established.
Covering Other Areas
The history of business insurance takes us again to America in the year 1863. The very first accident insurance policy was initiated in 1863. Sometime later, insurance that protected you against burglary loss (which is property taken through forced entrance) was offered. Theft insurance ended up covering other types of losses from stealing in 1899. The history capped off yet another significant area when the very first workers’ compensation insurance ended up being sold in 1910.
Business insurance companies saw a lot of growth in the area of finance as well as in the understanding of how people share and as well as manage risks. In the beginning, the underwriters were the ones who tried to capture the interest of the people to buy insurance coverage by talking to their business acquaintances. Then again, this ended up being very time consuming for travel. The solution was to appoint people who can travel via horseback and meet even more people who might be interested in the coverage. These, you could say, are the very first business insurance agents.
In an insurance policy, the person who buys it will pay a small amount in order to maintain the company’s promise to the person of securing the replacement of losses. These funds will come from all the money paid by other members of the insurance who did not incur losses, as well as other earnings from the investment made by the company. Being more than a promise, it evolved into a legal document that was agreed upon by the individual and the company.
Do you have what you need?
You already know by now that business insurance will be able to help get a hold onto the more important things. You might not be able to personally control or remove all of the risks (present or potential) which threaten your way of loving. Business insurance is a great way of providing such protection for you against these risks.
But this is only true if you actually have the right kind of business insurance for yourself. The difference with business insurance is that it is not as simple as car insurance. Since you have a unique business, the kind of insurance package you have will be different in order to meet the needs of your business. This is also necessary for you to have the level of protection that you feel comfortable with.
The very first decision you will make is to choose what type of insurance you will need in order to help your business. The top two types of business insurance for your business would be property and liability insurance.
Property Insurance
Property insurance will protect the assets which your business owns. This also includes the equipment as well as the building itself safe from damage or destruction. Should you find yourself running a home-based business, you may already have home insurance. However, you will also need to protect the business assets you have with a separate contents insurance. The reason for this is because the policy of the homeowner will not cover the business equipment.
Contents Insurance
Contents insurance, on the other hand, works to protect the business equipment you have from different perils such as fire, theft or flood. In order to determine just how much property or event contents insurance you will need, you can create a list comprised of the business assets you have as well as their individual values in dollars. Next, you can decide which of these assets you would want to insure and also for the value it has.
These will, of course, determine the kind of insurance premium you want. There may also be some cases where you might decide not to insure one particular asset. It may be because for you it is not worth the cost of what you pay for as premium. There are also some cases where the premium might even be worth paying for. To know, you should ask yourself some important questions – if the equipment (like the computer, for example) would be stolen, do you think you can pull together enough funds to replace it? If no, then you will need to have it insured.
Other Types of Business Insurance You Might Want to Avail
There are other types of insurance for your business which you may need. For one thing, there is liability insurance. Even if the business is really small, you and your employees will need this. Liability insurance is one kind which you need for your business because it serves as a protection in case you get sued for any reason at all.
General Liability insurance is yet another one. This will protect the business from different kinds of liabilities that arise from negligence and may cause others to be injured (like a customer or even an employee). It also works to protect the company if there is a person who is injured because of using your product or service. If you are able to consider that there are legal expenses as well as settlements or some kinds of judgment expenses that come from lawsuits, you might get bankrupt. Only when that happens you will see why this kind of business is something you must have.
If you are a company that sells good that are manufactured or assembles, you should check whether the general liability policy of insurance that you have will also cover product liability. If such is not the case, you might want to include this kind of specific liability insurance to the package you have. As a professional working as a doctor, architect, lawyer, realtor or computer consultant, you will probably want another type of insurance.
Professional liability insurance will range from different kinds such as malpractice insurance and people who are in the healing professions based on error and also omissions insurance. Should you be in doubt with regard to the kind of professional liability insurance you ought to get, you need advising. This can easily be done with a provincial professional organization. There are many areas where this kind of insurance is a must-have or some professionals.
Insurance for your Employees
A worker’s compensation insurance might be good for your employees. Providing employees with insurance is good practice even if you are the type who operates a small business. It might be very tempting to ignore this kind of employee insurance, but you should also know that having good employees are also the key when it comes to bringing about success in your business as well as providing them with the benefits they deserve. It will not only keep them happy but will also ensure that they are willing to do the work for you. You will actually be able to save a lot of money as well as time if you do this instead of constantly finding and also training new employees, as well as keeping the good employers which you already have making dollars as well as sense.