It is vital for every Rohnert Park established business to carry enough business insurance to protect it from the many problems that can arise that are outside the enterprise’s control. The precise kinds of business insurance that a company should have will depend on the nature of the company’s activities and other factors. Failure to have enough insurance protection could put a commercial operation at risk of facing severe financial payouts, and may even result in the company going out of business. This article looks at some types of insurance designed to protect commercial operations.

THE MANY VARIETIES OF COMMERCIAL INSURANCE

Commercial insurance is a general term that refers to insurance policies that are precisely tailored to meet the requirements of commercial operations. It should be noted that even a sole trader who trades informally may have to have some form of commercial insurance to avoid issues with the law, or with dissatisfied customers. As an example, a window cleaner who uses a motor vehicle to journey to, from and between jobs might be required to have commercial insurance for that vehicle.

While commercial insurance is a vital protective measure for all sizes of companies, in many ways it is even more important for smaller businesses with limited resources. The private assets of owners and directors of smaller companies are often less protected than those of big business owners, making it even more essential to have the right level of insurance coverage.

EMPLOYMENT PRACTICE LIABILITY INSURANCE

The coverage provided under employee practice liability insurance (EPLI) protects a commercial operation when issues arise that affect the employment process, specific types of work environment scenarios, and the termination process. Employers require this coverage to protect themselves from claims made by job candidates, existing staff, and past employees.

The kinds of claims that are most commonly made are those arising from the following issues:

• sexual discrimination or harassment
• racial or religious discrimination
• wrongful termination of employment

All workers of a company, as well as the directors and other executive officers, are covered under EPLI policies.

WORKER’S COMPENSATION INSURANCE

Worker’s compensation insurance is a particular type of coverage designed to aid both employers and their employees. Many accidents occur in the workplace, and where these result in injury to any employee, the staff member can apply for redress from the employer’s insurance provider.

For the Rohnert Park workforce, it is important to appreciate that claiming from the compensation insurance provider is not the same as taking a lawsuit against either the employer or the insurance company. In fact, the scheme is designed to offer compensation without resorting to the courts, and staff who make claims under the scheme must give up their right to sue.

This type of insurance benefits employers by protecting them from costly lawsuits, which could result in very high payouts. It also helps to get the difficulties resolved much more quickly. The most common claims under the scheme are for loss of earnings, and the reimbursement of medical expenses.

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GENERAL LIABILITY INSURANCE

General liability insurance protects firms from a wide range of liabilities. In essence, it provides coverage to businesses when third parties seek compensation due to injuries or damages caused by a business, its products, or by the negligence of its workers.

For instance, a general liability insurance policy for a retail outlet will protect the business from claims by customers who were injured while on the premises.

It will additionally protect the firm against claims that a product it sold caused damage to property or injuries to people through an integral design flaw or a malfunction. The retail outlet may be able to seek redress from the product manufacturer. Nevertheless, in most jurisdictions, the outlet will be the entity that is sued by the victim, which is why this type of coverage is important.

General liability insurance usually provides coverage for legal expenses involved in any lawsuit, medical expenses, and substantial damages or injury payouts.

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COMMERCIAL PROPERTY INSURANCE

Commercial property insurance is commonly a part of, but not the same as, commercial insurance. It is a type of policy that applies specifically to the actual physical property that a firm owns or leases. This includes land, buildings, machinery and other items. The most typical claims received under commercial property insurance policies are associated with fire, theft and natural disasters. In some cases, equipment is covered separately from buildings by means of commercial contents insurance policy.

Company owners should be careful to scrutinize the policy carefully to make sure there is enough protection. Every policy will differ in its specifics, but there are some general things that need to be taken into account. For example, some policies can provide for replacement of damaged or stolen machinery, or other company asstes. Others will provide financial compensation based on the current value of the property being claimed for.

Many company owners need this coverage to let them carry on trading with the smallest delay following a loss. As a result, it is probably best to seek a policy that provides for replacement rather than one that offers just the value (depreciation will be taken into account) of property.

Clearly, the price of a commercial property insurance policy will depend on the level of insurance required, and expensive policies could prove difficultto finance in some businesses. Having said that, if a business is hit by any disaster that means it is unable to trade until the missing or damaged items have been replaced, it is probably best to spend the extra money on an insurance policy that will let them get back in business as quickly as possible.

SUMMARY

Business entities are obliged by law to take out certain types of insurance policies. For example, it is a legal necessity to carry insurance on commercial vehicles. Other sorts of insurance coverage are voluntary, but it is unwise to decide to trade without proper coverage.

Insurance policies can be complex, and some company owners may be uncertain of whether or not they are fully covered for all possible scenarios. If that is the case, they could talk to an independent, experienced and licensed broker. Brokers are paid commission by insurance companies, and they fund that commission out of their profits, so there is no added cost to a firm that uses a broker to arrange business insurance.