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Avoiding risky business

Article provided by OUTsurance

Like every other growing business, yours depends on your absolute focus. However (and understandably), your attention is usually occupied by today’s operations and tomorrow’s potential deals, leaving little to no room for all the ‘what ifs’ that can easily threaten your business’ survival.

Fortunately, understanding your business’ risks and creating the foundation for a secure future does not have to be as challenging as it may sound. It can be as simple as spending a few minutes creating a list of the possible dangers to which your business may be susceptible to, and what you stand to lose when things go awry.

To get you started, here are a few questions that you may not have asked before:  

  • Does your business have customers or clients who visit your premises? Here, the real question is: what will happen to you if an accident happens to them at your place of work?
  • What special machinery does your business rely on? Your laptop? A laser cutting machine? Specific kitchen equipment? Can you do business without a certain piece of technology?
  • Are you using your personal vehicle for business purposes, such as deliveries or regular meetings with clients? Is it covered only for personal use by your insurer?
  • Does your business make or manufacture something? Can you still do business if this stock is suddenly damaged or lost entirely?
  • If you have employees working for you, what happensto your business if they do something wrong – whether it’s accidental or even fraudulent?
  • If your business activities are interrupted, do you still have business expenses to pay? Can you survive without income during this interruption?

Risk aversion begins with an investment in insurance.

While it may be difficult to think of insurance as anything other than an obligation, the truth is that it’s an investment in your business’ longevity. Changing your mindset and treating it as such will raise its value, turning that monthly grudge purchase into an important monthly contribution towards protecting your cashflow and keeping your doors open.

Armed with your list of possible risks, you can begin to make sure you have the correct insurance cover. The good news is that there are many insurance cover options to choose from, giving you the opportunity to create a bespoke solution for your very specific needs.

For starters, if you rely on key pieces of equipment, you can get cover for machinery breakdown or accidental damage. And even business interruption cover that pays towards financial losses when your business isn’t operating due to damages that may have occurred.

For those who work with people and their property, there are also many options that create peace of mind. Public liability cover is inexpensive and will protect your customers from injury and their property against damage caused by you. Or, if your employees steal money from your business, you can rely on fidelity insurance to make things right.

In short, there’s the right cover for your business. It doesn’t matter if you’re a one-person show or a large and complex operation spanning many locations.

But before you sign on the dotted line with your insurer, make sure you’ve done all the necessary reading. One of the biggest perils is being under-insured. For example, there’s no point covering an asset if it’s not covered for its full replacement value – especially if your business operation relies on that asset. How would you pay for the shortfall?

The other thing to be sure about is your insurance policy conditions and exclusions. Here, you don’t want to be paying premiums towards cover that will never pay out due to certain criteria not being met. In most cases, these conditions are in place as a protection measure, ensuring scrupulous business practice.

Of course, there are people who can guide you through your risk journey, creating your very own customised insurance solution. In fact, OUTsurance will send a dedicated Business OUTsurance agent to meet with you face-to-face at your place of work, no matter the size or type of business you’re in. Or, if your needs are simple, an expert call-centre advisor can help you right now. Call 08600 60 000 or visit outsurance.co.za

OUTsurance is a proud Partner of the NSBC.

The content of this article should not be construed as advice. In order to receive the appropriate advice, taking into account your specific business circumstances, please contact OUTsurance. OUTsurance is a licensed insurer and FSP (896). Ts and Cs apply.