What insurance do you need when growing your business?
As your business grows and evolves, so could your insurance needs. Expanding your business, whether by increasing the scope of your operations, hiring more employees or opening a new location, may require careful consideration of your insurance coverage. Ensuring you have the right insurance policies in place is crucial to help protect your growing investment and mitigating potential risks.
1. Review current policies
The first step in ensuring adequate coverage when your business is growing is to review your existing insurance policies. The idea is to look into your current general liability, property and business interruption insurance policies to determine if they still meet your business's needs. Expansion can often increase exposure to risks, so your existing coverage limits may no longer be sufficient.
2. Identify new risks
Growing your enterprise could introduce new risks your current policies may not cover. For example, opening a new location may expose you to different environmental hazards, customer demographics or regulatory requirements. Identifying these new risks would help you to work out the extra cover you need to protect your business.
3. Update your insurance
As your business expands, it's often crucial to fortify it with the right insurance policies.
- General liability insurance can help shield you against the cost of third-party claims of bodily injury or property damage, helping to protect your business financially from potential lawsuits.
- With growth often comes the acquisition of new assets, making property insurance vital to help safeguard your buildings, equipment and inventory from perils like fire, theft, and natural disasters.
- Don’t forget business interruption insurance, which can be a financial lifeline during any unforeseen events which may halt your operations.
- As your workforce grows, you will also need to ensure your workers' compensation insurance is still adequate, providing essential benefits to employees injured on the job and to help shield your business from the cost of legal actions.
- In the digital age, cyber insurance is a must-have, to help guard your business against the cost of cyberattacks and data breaches that could compromise sensitive information and customer trust.
What’s important is to tailor your insurance strategy to your expanding business needs, so you can navigate your growth journey with confidence.
Tips for managing insurance during expansion
It’s easy to let your insurance requirements fall down your to-do list when you’re expanding. But this can increase your business risks at a time when you need to be working on the business rather than managing a claim. As your business continues to grow, regularly reviewing and updating your insurance policies is essential. So make it a priority to do a yearly insurance audit to assess your coverage needs and make adjustments to your policies as necessary.
An experienced insurance broker can give you valuable guidance as you navigate the complexities of expanding your business, helping you to identify coverage gaps, recommend appropriate policies and negotiate competitive rates. Talk to BICS today to ensure you have a comprehensive insurance strategy that aligns with your business goals.
Important notice
This article provides information rather than financial product or other advice. The content of this article, including any information contained in it, has been prepared without taking into account your objectives, financial situation or needs. You should consider the appropriateness of the information, taking these matters into account, before you act on any information. In particular, you should review the product disclosure statement for any product that the information relates to it before acquiring the product.
Information is current as at the date the article is written as specified within it but is subject to change. BICS make no representation as to the accuracy or completeness of the information. Various third parties have contributed to the production of this content. All information is subject to copyright and may not be reproduced without the prior written consent of BICS.
