In the ongoing economic scenario, credit crunch is the major problem faced by businesses especially small business owners. Willingly or unwillingly they are bound to cut expenses wherever possible. The reduction spree becomes so intense that businesses also downgrade their commercial insurance which is a wrong path to growth. Before going in depths, it is important to understand the exact meaning and purpose of buying a commercial insurance.
What is Commercial Insurance?
Commercial Insurance is a kind of coverage for businesses which is intended to protect business from any possible losses through unexpected circumstances namely liability, theft, property damage etc. Basically, it is a contract between an insurer and a business owner which aims to minimize owner’s risk against losses, accidents, natural disasters or any unforeseen trouble. The insurance includes cover for business buildings, machinery, equipment and stock and other contents falling within the building premises.
Commercial Insurance
Why Commercial Insurance is important?
When there is a question of safeguarding a business from any unexpected risk or harm, the size of the respective business doesn’t matters. The basic aim behind commercial insurance is to incorporate different types of business insurances into one policy that is compatible to cover all business areas. The several types of business insurance integrates buildings insurance, stock insurance, crime insurance, casualty and liability insurance, worker’s compensation insurance, public liability insurance, and building contents insurance.
Business property insurance protects all risks to a business premises covering loss to the buildings, fixtures and fittings on the premises. The premiums of this insurance are calculated on the basis of rebuilding costs of the business property. It will also contain elements of public liability to protect a business against public claims.
A large amount of commercial property is either leased or rented. Commercial insurance offers expert cover for these types of premises with a let property insurance policy. The policy is tailor-made for business landowners. Under liability insurance cover, a business is protected by all liabilities that an enterprise might be liable. Commercial liability insurance cover comprises public liability insurance, products liability, directors and company officers liability, employers liability, professional indemnity insurance and directors insurance.
A company buys directors insurance or Directors and Officers Liability (D&O) to protect the personal resources of directors. The policy is a liability insurance payable to the directors and officers of an enterprise. The liability is designed to cover directors from legal costs incurred in protecting themselves from claims of a ‘wrongful or illegal act’.
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