There are important insurance policies for aspiring founders both in the personal and operational areas. Health insurance is mandatory for the self-employed anyway. However, depending on the company, some risks are more likely than others. However, liability, business content, or company legal expenses insurance are relevant for most founders.
It is important that you assess risks, check the insurance needs and compare the offers for important insurance. Getting insurance certificates from firms is something you should also get into consideration.
At the start, also consider important insurances
If you want to start a business, many questions shoot through your head at the beginning. What does your own business idea look like in concrete terms and can you really be successful with it? What should the company be called? How do I write the business plan? And many more questions. When all these questions are answered and everything slowly takes shape, then another question arises:
What about insurance coverage?
To answer this question, you have to consider what risks the company faces and how best to protect them from them. This has to be decided individually for each case. Nevertheless, there are some risks against which every young entrepreneur should insure himself. Important insurances are presented below.
Important insurance in the private sector
Illness, absence from work, occupational disability – the risks in the personal area of a founder are manifold and the consequences can be expensive. Important insurances are accordingly health insurance and occupational disability insurance. In the case of health insurance, there is basically a choice between statutory or private health insurance.
TIP: Private health insurance is often the more attractive choice for the self-employed. Make a non-binding and free comparison in order to be able to compare the costs and services of the respective tariffs.
The most important commercial insurances
In order to get an overview of commercial insurance, you should first consider what risks can occur for your own company and how serious a loss can be. Accordingly, below are three common risks that can quickly threaten the existence of a business.
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Risk 1: Damage to office equipment
In order to insure against the risk of damage to the business inventory or furnishings, the following applies: business content insurance is often important insurance and a conclusion is recommended. It applies in the event of damage caused by:
- tap water or
- Burglary (including vandalism as a result of a burglary).
If, for example, a short circuit in your offices ignites a fire and damages or destroys the furnishings, you will be compensated for the damage incurred by the insurance company – at replacement value.
Another risk is that, as a result of such damage, work in the company will be severely impaired or even come to a standstill. Therefore, it is advisable to supplement the business content insurance with a so-called business interruption insurance. In such a case, this replaces the lost operating profit and supports you in coping with ongoing costs – so also important insurance.
Risk 2: Liability claims against your company
Despite the most careful work, mistakes can happen again and again. If you or your employees make a mistake and this leads to damage to a third party, they can assert liability claims against your company. And that can be expensive. Therefore, you should protect yourself for exactly this case – with business liability insurance. The following types of damage are covered by this important insurance: personal injury, property damage, and consequential damage (caused by personal injury or property damage). If, for example, a customer slips in your business premises because the floor has been freshly mopped and the warning sign has not been clearly visible, the insurance will cover the resulting costs.
In the event that a customer suffers a so-called real financial loss due to a mistake of the company and asserts a liability claim, it is advisable to have financial loss liability insurance. A real financial loss is understood to mean purely financial damage that is not caused by a previous personal injury or property damage. If, for example, a customer suffers financial losses due to your incorrect advice, the resulting damage will be covered by the insurance. For some professional groups, such as lawyers or tax consultants, the conclusion of such insurance is required by law – so it is clearly one of the important insurances.
TIP: Which commercial insurance is necessary for your company? Use the needs analysis for an initial assessment.
Risk 3: Legal disputes
In order to be protected against the risk of litigation, every self-employed person is strongly advised to take out insurance as important insurance. A company’s legal expenses insurance to increase. Should there be a legal dispute, for example with one of your employees or the landlord of your business premises, the insurance will cover the costs – from the first consultation by a lawyer to a possible court case.
Customize insurance cover
Damage to office equipment, third-party liability claims, or legal disputes are risks that every company will be confronted with sooner or later. Therefore, it is essential to take care of the appropriate insurance coverage and to take out important insurance. However, it should be remembered that there is no lump-sum package for commercial insurance that adequately protects every company founder.
It is therefore strongly recommended to inform yourself in the best possible way about the potential risks of your own company and to select the commercial insurance coverage and important insurances accordingly: make the non-binding Needs analysis for your insurance cover.
It is also important to consider risks arising from hacker attacks or the like because you will only protect against damage caused by such attacks. This does not protect you from cyber attacks, but subsequently takes care of damaged company property, liability claims against your company (e.g. due to data protection violations), or legal disputes.