Running a business without insurance can be stressful. This is because the owner is choosing to operate their company by not covering their building, employees, and machinery. While this might not be something you would consider, there are business owners who decide to just risk it.
This is a shame as protecting your business against potential loss not only gives you peace of mind it can help your business grow. That’s right, paying for insurance can help your business grow. Still not convinced, well here are some reasons why this is true.
- Sometime Suppliers and Customers Face Financial Difficulty
Unless you are running a service business, odds are that your business relies on suppliers to deliver the raw materials or finished products that you sell. But there are times when suppliers run into financial problems and this can impact their ability to meet their obligations to you.
In addition to suppliers getting into trouble, there are also times when customers face financial issues. While this happens to just about every customer during an economic downturn, this case is more about having a core B2B customer who gets into trouble and no longer needs the product or services your business offers.
When this happens, your business cash flow will be left in a bind as a major customer will no longer be providing the revenue your business needs to grow. The impact is two-fold. First, you will need to get small and this can mean cutting back on orders and overhead. Second, you might face issues collecting on what the customer owes your business. Either way, a customer-facing financial difficulty can mean problems for your business.
How can insurance help in this situation? The simple answer is trade insurance or credit insurance. These are policies that cover the goods you buy and sell and can ensure your business is covered in case of a trade-related loss.
- You Can’t Predict Risk
One of the core elements of risk is that it is unpredictable. An example of this is the World Economic Forum’s Global Risk Report. While this report has been tracking “risks” since 2008, the nature of the risks which most concern business leaders have changed significantly in the last decade.
In 2008, the biggest risks were political instability, oil and gas prices, as well as falling asset prices – due to the subprime crisis. Fast forward to 2018 and the top risks are weather and a changing climate.
This highlights another reason why insurance can help grow your business as you never really know what is going to come next. Imagine your business has a fleet of trucks that drive thousands of miles per year. Granted the government requires insurance but having enough insurance could mean the difference between having to pay for a truck accident lawyer directly or having your insurance help cover the cost.
As you can see, using insurance to help limit the impact of risk on your business can ensure that you are not only well-positioned to cover your company in case of a loss but also can save you money which can then be used to invest in growth.
- Attract the Best Talent
There is no doubting that the cost of healthcare in the U.S. is much higher than in other developed nations. But did you know that having the right benefits package – which includes employee health insurance – can help your business to be an employer of choice.
That’s right, people do choose where to work based on the benefits on offer. As such, working with your insurance agent to develop an employer-sponsored health insurance program can not only reduce the cost for your business but can also give you a leg up in attracting the best talent.
In terms of reducing costs, this happens in two ways. First, shopping around can help you to find a program with the highest level of coverage for the lowest cost. While offering your employees a robust insurance program can help them to address health issues as they occur, which not only reduces lost time due to sick days but can help you to keep your premiums low over the long run.
While insurance does not come free it can not only help to protect your business, but it can help you grow. This is especially true when your suppliers or customers financial difficulties, or because you can’t predict risk and to help you attract the best talent. Don’t try to go it alone, get the coverage you need and then focus on building your business.