Reducing Your Liability: Tips For Business Owners

Insurance Blog

As a business owner, you have insurance to cover your property and your business itself in case of natural disaster, fraud, or other unforeseen emergencies. However, sometimes business owners underestimate the risk of liability, even with liability insurance. If you are hoping to keep your insurance rates low and avoid any personal injury or civil lawsuits that could harm your business finances, here are some tips to consider. 

1. Have Strong Communication Policies

It's essential that your never misrepresent your business to your customers in any way. Train employees on how to speak to customers or clients, and do not make firm promises or guarantees unless you are prepared to back the guarantee with the financial health of your business. 

Avoid making statements against competitors that could be viewed as slander or libel. Finally, make sure that you only partner with companies who have firm reputations. If you do business with a company who has poor communication policies, you might be drawn into a lawsuit because of what your partnering business said, wrote, or did. 

2. Stay on Top of Property Maintenance

Injury lawsuits can often break a business, especially if your business is small or just getting off the ground. Properly maintaining your physical business property is your first line of defense in preventing customer, employee, or contractor injuries. Be sure to:

  • remove snow and ice from stairs and walkways.
  • mop up water spills from main areas of traffic. 
  • fix any broken steps or handrails on your property.
  • stay on top of air conditioning and heating repairs.

A daily walk through to clear away even the smallest hazards will provide the ounce of prevention that equals the pound of cure. 

3. Keep Your Personal Assets Out of Your Business

If you are the one person who works for the business, you might not see any harm in owning your business as a sole proprietor. However, this means that if you do get sued, all your personal property, including your house and retirement accounts, can be at risk. Instead, it's better to create a limited liability company that "owns" itself. You can have a separate bank account and contracts with the LLC as the "proprietor" instead of you personally. 

4. Invest in Increased Cyber Security

In an age where everything is digital, you have a greater responsibility to ensure the safety of your customers' personal and financial information. You might have names, card numbers, account balances, passwords, social security information, or other sensitive history that makes increased security your responsibility. If you don't have a good, secure server and programming, if your customers, clients, employees, or contractors are harmed by a leak or hack, you could owe millions in damages. 

5. Follow Employment Laws to the Letter

Another area where businesses can falter is in the area of employee lawsuits. Your business insurance should help cover the cost of a lawsuit that occurs because of something you can't control, like a worker's compensation claim. But employees can also sue for things like:

  • wrongful termination. Sometimes, even "at will" employees can sue for being fired, depending on the situation.
  • harassment. Do all you can to reduce sexual harassment in the workplace. 
  • discrimination based on age, race, sex, or sexual orientation.
  • poor working conditions. Your working hours, pay, and time off policies should fully comply with state and federal labor laws. 

If you're concerned about employee wellness and your legal responsibilities, you should consult both your insurance company and a business attorney.

For more information on business insurance, contact a local insurer in your area to talk about the type of coverage you need for liabilities. For more information, contact companies like Insure With U.S.


2 August 2017

Preparing for the Future

Ten years ago, I married my best friend in a beautiful, intimate ceremony. My husband and I have been nearly inseparable and we’ve enjoyed this special time in our lives where it has been just the two of us. However, we’re finally ready to have a baby. Because I only work part-time, my husband is the primary financial provider in the family. If something ever happened to him, I wouldn’t be able to instantly support myself and a child. Because my husband worries about an uncertain future, he is considering purchasing a larger life insurance policy. On this blog, I hope you will discover the best types of life insurance policies for young parents to invest in. Enjoy!