Everyone needs insurance. For companies, it manages risk. But getting corporate insurance is tricky. You want the best deal without over or under-insuring.
This article explains corporate insurance, gives examples, and discusses how to get the right coverage in Canada.
What is Corporate Insurance?
Corporate insurance is insurance used by companies and other commercial organizations to protect their business against any operational risks. Such risks range from theft and accidents to losses due to fraud and fire. Corporate insurance is generally comprehensive and usually benefits the company and its employees or even past employees.
Steps for Getting Corporate Insurance
The challenge of getting an ideal insurance policy is that no one can perfectly predict the future. It’s this inability to predict risks that provides profit for insurance companies. But insurance isn’t a gamble. Here are the steps to getting an ideal commercial insurance policy.
Determine and list all your business risks
The first step to getting any corporate insurance is to inventory your business’s potential liabilities and losses. This must be comprehensive, which means it will cover all properties, buildings, equipment, vehicles, death of key employees, cybersecurity breaches, disruptions in the supply chain, etc. The list should include every possible thing that could disrupt your business and lead to losses.
Separate Commercial liabilities from personal liabilities
Small business owners must separate commercial and personal uses. This prevents under or over-insuring. For example, personal auto insurance may not cover commercial damages. And personal risks don’t belong under commercial policies. That just raises costs without benefiting your business.
Explore strategies for reducing your premium
Small business owners must separate commercial and personal uses. This prevents under or over-insuring. For example, personal auto insurance may not cover commercial damages. And personal risks don’t belong under commercial policies. That just raises costs without benefiting your business.
Use a broker or insurance company that is an industry expert
Every industry has brokers who know its risks. They offer proper protection. For example, restaurants and pharma companies need different coverage. Find a broker expert in your market. They’ll pick the right policy. And potentially cut costs. You can also go direct to insurers to save broker fees.
We recommend Insurance Direct Canada. They are our top choice for insurance brokers in Canada.
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Types of Corporate Insurance
There are several kinds of corporate insurance in Canada, and here are some of the most important for any business in Canada:
Commercial Property Insurance
Every business has property to protect. Physical things like buildings and equipment. And intangible things like intellectual property. Risks include fire, flood, theft, vandalism, and natural disasters. Intellectual property can also be stolen or infringed.
Never under-insure valuable properties. Anything your business can’t function without should be insured. When it comes to property insurance, cover what you can’t live without.
General and Professional Liability Insurance
Businesses need insurance for legal issues. Product accidents, workplace injuries, etc. General liability insurance covers damages, lawsuits, and related costs.
Professional liability insurance is for negative outcomes from professional advice. Like a financial planner being sued over bad advice. It covers legal costs and damages if you’re held responsible. Get it if you offer professional services.
Commercial Auto Insurance
If your company owns vehicles necessary for its operations, it’s important to get commercial auto insurance. You can insure the whole fleet where you have several cars. This is cheaper than getting individual auto insurance for each vehicle. How many vehicles amount to fleet differs in each Canadian province.
Cybersecurity Insurance
Cyberattacks and ransomware attacks have become very common in an interconnected world where most businesses rely on computers, data, and the internet to operate seamlessly. Most attacks target small businesses that may not have the funds to recover quickly. You can protect yourself from the risks by getting cybersecurity insurance. Note what the insurance covers and what will trigger the coverage.
Crime Insurance
You can also get insurance to cover any losses from an employee’s fraudulent or criminal act against your business. Crime insurance can save you the heartbreak and financial loss of learning that an employee is shortchanging you. Crime insurance can cover several actions.
Corporate Personal Insurance
Get insurance to protect against key officers or the loss of key personnel. For example, if directors breach duties and expose the board to claims, or a key employee gets sick or dies, hurting finances, key officer insurance covers officers. Key person insurance protects against the loss of crucial staff.
In Conclusion
Corporate insurance is essential for every business. But it’s important to know how to get the right policy and, more importantly, the types of insurance you’ll likely need. You can speak with an expert brokerage firm to get specialized advice.