February, Monday 18, 2019
There are a lot of things you get to skip as an online entrepreneur including paying for a physical office and having a limited number of employees since a lot of the repetitive tasks can be automated. But insurance is one factor you should never try to avoid if you want to shield your business against eventualities.
Now that you are clear about that, the next question is what kind of insurance is suitable for my business? For bricks-and-mortar stores, answering this question is fairly easy but for online stores, we shall start by examining certain factors.
First of all, we shall be looking at the potential liabilities of an e-commerce business. As an online business owner, you may not have a physical office, but you sure have stock of goods that you supply to buyers. It is important to know that it does not matter whether you manufactured the goods or not. If a product that supplied under your business name causes injury to a buyer, you may be held responsible. You may also suffer direct losses resulting from unexpected events such as data loss.
In the same vein, if your website is exposed to any kind of data leak, website hacking, and loss of stock in the warehouse. Having the right insurance coverage can protect you in case of such events.
Secondly, it is crucial to understand that specialist insurance cover for online businesses isn’t easy to find. Online businesses are still relatively new and the specifics about their operations are still vague. Making it a no-go area for many insurance companies. And for many insurance companies that do offer products for online businesses, a lot of clauses can prevent you from qualifying for a claim.
For example, if you have a general business continuation insurance which is supposed to protect your business in cases of business interruption, your business may only be able to file for a claim if the interruption persists for a minimum number of days.
That said, you can work with a reliable broker to find the right product for your business. So here are a few tips to ensure that your business is adequately covered. These tips will also reduce the risks of landing in legal cases that may require you to pay huge sums of money in compensation.
Are you interested in getting insurance coverage for your online business but still not sure how to go about it? Our expert brokers can help out.