Imagine a business venture burnt to ashes overnight due to something as little as a gas leakage. There’s so much pain to be felt by the business owner as well as so many troubling questions in his or her mind. These questions include how to bounce back, where to start from, how to pay back debts owed and so on. As much as nobody wishes for an unfortunate event to happen in their businesses or personal lives, making a provision against such event is a wise thing to do. Hence why we have got INSURANCE.
According to Wikipedia, Insurance is a means of protection from financial loss. It is a form of risk management, primarily used to hedge against the risk of a contingent or uncertain loss ».
Business owners specifically, tend to derive quite a number of benefits from insurance and below is a list of five ways that a business and its owner can benefit from insurance.
1. Payment for Losses
The topmost benefit of insurance for business owners is the outright payment/indemnification you get for your financial losses after the occurrence of the unfortunate event. Since you are duly insured against such occurrence, you do not have to fully bear the loss (or you may just bear just a portion of it) depending on the type of insurance. When such losses occur, it is the responsibility of the insurance institution to pay for the losses and get you back on track with your business activities.
2. Saves Stress in Difficult Times
Losses are not planned by many business owners and things can be stressful when it finally occurs. This is because a loss can be physically, emotionally and psychologically draining. Sequel to getting your financial losses covered, you also get due relief from the stress and worries that could have brewed if there was no insurance back up.
3. Business Stability
A loss, whether little or large affects the stamina of your business. With Insurance, bouncing back after the occurrence of an unfortunate event almost immediately ensures business stability and consistency which in turn increase the life span of the business. It also gives your clients and customers the reason to trust your business because of it's resilience in the face of such negative occurrence.
4. Increases Credibility of Your Business
Coming from the point of business stability, an insurance policy for your business gives investors a guarantee and makes them confident enough to invest in your business. Businesses that are insured and registered with the Securities and Exchange Commission (SEC) gives investors a large yard to observe and bet that your business is credit worthy. This is business goodwill as it helps you erase doubts from the minds of the lenders.
5. It Complies with Legal Requirements
Insurance can be part of legal requirements for running a business in some countries and this gives your business the complete legal standards to compete with other businesses in your industry.
Every business professional should approach insurance just like saving for emergencies or rainy days because in every business, you cannot be certain of what loss might occur. Whether the loss insured against occurs or not, insurance poses a lot of benefits to businesses, owners and stakeholders. If you have ever disregarded the idea of Insurance, take this as an assurance that you have nothing to lose and rather a lot to gain from it.
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