Risk protection comes in many forms, depending on what is needed for coverage and who purchases the policy. Risk exists for many types of businesses–both big and small–which require protection from property damage as well as liability for injury. As a result, companies need to purchase an insurance policy with adequate coverage amounts. The amount of insurance that is required will depend on the type of risks involved.
Property insurance is required by any business to protect a building and its contents from various types of risks, such as fire, theft and vandalism. In addition to providing building coverage, property insurance can be purchased to cover equipment breakdowns, such as boilers and other machinery. Property insurance can also be purchased for debris removal after a loss and for new building construction.
Liability insurance is one of the most important types of risk protection that a business can purchase. This type of insurance provides protection when injury or property damage occurs to a third party, such as a customer or visitor. Liability insurance will pay for medical expenses and will also pay for legal costs in the event that a business is sued by an injured third party. The most common type of liability insurance that a business canh purchase is a general liability insurance policy.
Business interruption is a risk coverage that is available on a commercial property insurance policy. When a loss from an insured risk forces a business to close temporarily, business interruption coverage pays for salaries, rent and any taxes that would be due during a short period until the business reopens.
Errors and Omissions
Companies or individuals that provide a service to clients, such as an insurance agent or lawyer, may require errors and omissions coverage. This type of coverage can be included on a general liability policy. The coverage provides protection when unintentional mistakes are made that cause injury to a client or third party. Coverage does not normally apply for a person’s poor judgment or an intentional act that causes injury or loss.
Injury that can occur to employees is a risk that is covered by a workers’ compensation insurance policy. This type of insurance is required by every state for businesses that have a certain number of employees. Workers’ compensation insurance will pay for injuries that are sustained by an employee while on the job. Employers are also protected by a workers’ compensation policy, because employees are generally prohibited from suing their employers.
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