The Most Common Business Insurance Claims
There are a number of challenges and setbacks that can impact your business. When the unexpected occurs, business owners with insurance coverage can file claims to recoup money and cover the damages. Some of the most common business insurance claims include facility and equipment damage, burglary, product liability, and reputation harm. Is your business covered?
Speak with a King Street Agency insurance agent to discuss your insurance needs today. Contact Us.
Which Threats Affect Your Business Most?
Location, business type, and other factors determine the issues which are most likely to affect you. For example, flooding damage can happen anywhere, but is more common in regions that get excessive rain. Problems like burglary and theft are heavily based on the area your business is in. Understanding the factors that are most relevant to your business can help you purchase the right types of insurance coverage.
What Are the Most Common Business Claims?
While the claims that are most likely to affect your business may vary, here are some of the most common business insurance claims throughout the country:
While it only pertains to businesses who sell products, product liability insurance claims are among the most common filed by business owners. No matter the type of product you sell, it comes with an inherent risk of failure and potential to cause injury.
In low-risk industries, the average cost of product liability insurance is $.25 per $100 of income. That means that for every million dollars worth of business coming from a particular product, it’d cost $2500 to insure it. Keeping in mind that the average cost of a product liability claim is $35,000, you can see that insurance coverage is well worth this cost.
Harm to Reputation
Any business owner will tell you that reputation matters. That’s why reputation harm is among the most common claims filed by small businesses today. Not only is it common—it is also among the most expensive claims filed by businesses, averaging $50,000.
Although intangible, your reputation is priceless. Damage to it can come from a variety of sources and can grind your business to a halt. In the event of libel, slander, or costly invasions of privacy, you’ll want to file a claim as soon as possible to protect your business.
While businesses in coastal locations that get a lot of rain may be at bigger risk of water damage, certain hazards can cause water damage for any type of company. For example, a ruptured water pipe or failed drain can lead to water damage that destroys your equipment and costs you thousands.
Since all businesses use plumbing and water to some degree, water damage is a significant potential hazard and one of the most common insurance claims made by businesses.
Fire Insurance Claims
Most building are vulnerable to fire, and the causes may vary greatly. According to Insurance Journal, fire claims rank in the top five most common claims made by small businesses. In fact, 10% of all claims are related to fire damage.
The most common causes of business fires include:
1 – Cooking Equipment
2 – Heating Equipment
3 – Electrical and Lighting
4 – Smoking-related Accidents
5 – Arson
Get The Insurance Coverage You Need
Whether you need protection against burglary and theft or product liability, our agents at King Street Agency will provide the guidance you need. Our goal is to make sure you are confident in the types of insurance coverage you need, so you can enjoy the peace of mind knowing that you’re protected.
Not every business needs every type of coverage, so we’ll help you decide on the options that are best suited for you. Contact us today for a consultation.