Did you know that insuring your business no matter how small it is can help you mitigate risks including legal fees? Well, experts agree that insurance benefits by far outweigh costs a business owner would incur.
According to Humprey Ndalga, an insurance expert, covers are not only for corporates but also for small businesses, commonly known as Small and Medium Enterprises (SMEs) that stand to benefit.
Many startups work on a tight budget majority of which forgo certain types of covers that are not required by law.
"Insurance policies vary depending on a size of a company, but policies are designed to fit any business," Ndalga told Business Hour Ke, a YouTube channel.
He said the covers are necessary because a business owner does not know when he/she would need the cover in case of damages.
"An accident may happen, so the best time is now. Never wait for the right time," Ndalga added.
He noted that there are different underwriters who describe business differently with those whose asset value fall bellow Ksh500,000,000 considered as small.
"Insurance companies categories small businesses differently, some rate a business with less than Ksh500,000,000 as a small business,"
Types Of Insurance Covers And Benefits
Insurance covers, according to Ndalga are required by law once your business reaches a certain size. Below are some of the policy covers for business
Fire insurance Cover
This is a package which according to the expert covers various products ranging from public liability, computers, public liability, machinery breakdown.
Fire is one of the most common and costly commercial insurance claims for small businesses.
Workers’ compensation
This compensation covers employees if they sustain injuries in line of duty or suffer from illness while serving as staff of that particular company.
This is a legal requirement such that if an employee is involved in an accident at work, an insurance policy would carter for damages
Transit cover
Ndalga stated that this is is a type of policy that covers for transportation companies. He also said that a cover depends on the kind of business. Higher risk business with more employees will attract higher premiums.
It, however, depends on how you would purchase a policy. Ndaalga said one can go through a broker, an agent or a bank. Laptops are leading in the number of claims. This is because of their portability and convenience to use in office places.
The other benefit is cash flow. If you did not have insurance for fire, a business owner will be required to go back to the drawing board unlike if you had a cover.
Cash flow - if you lost a laptop and had insured a business, insurance company would help you get a replacement if a claim is tabled. According to Ndalga, majority of business people who understand the benefits of policy covers never worry about their work when they leave office for home.
"If you insure your business, you not have peace of mind because you will sleep peacefully knowing that if something happens to your business, you will be compensated," he explained.
