The following signs of business growth can increase your company’s risk and require updating several types of insurance coverages. Ensuring you have the correct type of business insurance is an essential step in maintaining the growth you’re experiencing.
1. Hiring an employee
It’s unfortunate that businesses commonly overlook minor details which can lead to unnecessary consequences. Even something as simple as making sure employees receive a company handbook should be taken seriously. The simple task of providing new employees with handbooks will ensure they understand policies, procedures, and potential risks associated with their job functions.
Hiring new employees may also require you to update the company’s workers’ compensation insurance. Educating employees about workplace safety and having the correct compensation insurance means you’ll be able to provide wage replacement and medical benefits to any employee injured on the job. Perhaps more importantly, the right workers’ compensation insurance will protect your businesses from legal action if an employee has an accident.
2. Moving to a new location
The need for a larger space or new location is an exciting transition for a business, and making sure you’re properly covered is an essential step in the process. Aside from making sure you’re covered if anything is broken during the move, you’ll also need to update your commercial property insurance since it’s tied to physical location. If your new location is in a flood zone, you’ll also need to include flood insurance in your policy. These simple steps will keep your business covered before, during, and after the move.
3. Expanding or renovating existing location
As with any task employees take part in, having a plan in place to prevent injuries and maintain productivity should be standard operating procedure. Sometimes even the most thorough risk management can’t prevent unforeseen accidents, in which case you’ll need to make sure you’re covered if any accidents or injuries happen while renovation or expansion work is being done. If you didn’t check into it prior to commissioning the work, make sure the company’s property insurance covers all aspects of the new spaces.
4. Offering a new service
Although offering a new service is a great way of attracting new customers, it often comes with a new set of risks. If you’ve decided to launch a new service, it’s a good idea to make sure your current professional liability insurance provides adequate coverage. If it doesn’t, you’re opening yourself up to a huge liability. If the new service involves delivery, shipping, or travel, consider updating to something that includes small truck fleet coverage. These small tweaks can help in big ways, should anything ever happen.
5. Selling a new product
Launching and offering new products is a great way to increase sales to existing customers and attract new ones. As with offering any new service, however, there’s a whole new set of challenges you may face. An expansion is a great time to check and update the liability insurance portion of your General Liability Insurance. That’s the part of the policy that offers protection if a product injures a customer or makes them ill. Product liability insurance and recall insurance can protect against claims made for compensation or damages due to defects, anomalies or malfunctions that are discovered after products are shipped to customers.
6. Taking on new clients
Taking on additional clients is certainly a recipe for growth, but with growth comes great responsibility. Protecting yourself in the digital age should remain a priority for your business, especially when storing potentially sensitive information. Staying up to date with the latest cybersecurity is always a great idea as well as making sure your cyber and data breach insurance is updated to protect you if a breach occurs.
7. Buying new equipment or furniture
Just as you would with a home, ensuring the property inside your business is a necessary step in expansion. If the new items are valuable, verify that the business owner’s policy or commercial property insurance policy will cover them. You will also want to make sure your workers’ compensation coverage is adequate if employees will be assisting with lifting, moving, or installing the equipment or furniture.
8. Adding new leadership
The addition of new leadership means more people with access to sensitive information. This growth indicator means it’s time to make sure your cyber insurance policy is updated. This is also a great time to procure or update the Directors and Officers Liability Insurance (D&O Insurance). This insurance covers directors and officers for claims made against them while serving on a board of directors or as an officer. Claims may be made as a result of managerial decisions that cause the company to experience negative financial consequences.
9. No plans for growth
Even if your business isn’t projecting growth in the coming year reviewing your current business insurance policy is still a best practice, making certain the business isn’t underinsured. You’ll likely be engaged in other housekeeping items during the end of the year, so take the time to ensure your business is protected. Unnecessary business risk as a result of inadequate insurance can be costly, so save yourself the potential headache and contact one of our advisors today to make sure you’re covered.