Knowing Which Insurance Policies are Most Important to Your Business
If, from a strictly legal point of view, only a few coverages are compulsory - vehicle insurance, civil liability and specific insurance for certain sectors of activity. SMEs have every right to subscribe to additional business insurance policies. Beyond the bare minimum – which consists of property insurance, loss insurance or professional civil liability – certain contracts may prove useful in relation to the company's activities (computers, chemicals, transport, cyclical activities...) or be used to facilitate its expansion.
Insurance against operational losses is a must. Too many SMEs neglect this non-compulsory insurance, which is, however, a great help in case of a disaster. Most disasters make it impossible for companies to continue their day-to-day activity. Pending the restart of production or service, this insurance covers the fixed costs of the company (salaries, repayments of interest on borrowing, etc.) and the additional costs involved in finding solutions to help the business return to normal (office rentals, use of subcontractors, etc.). Contacting an insurance agency when disaster strikes is a must.
The company defines the time it needs to restore its financial equilibrium. This period, which usually takes at least one year, can be up to two or even three years. Additional guarantees allow companies to hedge against claims resulting in a shutdown of their suppliers or subcontractors. In older policies already subscribed by certain companies, their operating loss can be the subject of a specific policy. From now on, this guarantee is a part of the company's comprehensive property and casualty insurance guarantee.
Environmental risk insurance should be considered, as well. A company which does not have an industrial or storage site and is not subject to prefectural authorizations for pollution risks may cover its environmental risk through its general civil liability policy. With prefectural authorization to carry out its activity, it must subscribe a specific contract through a local insurance agent to cover any environmental damage.
Guarantees of damage to the environment (extensions of professional civil liability or specific contracts such as environmental liability insurance) are essential for companies whose activities can harm the environment (air, water, soil and ground water, damage to protected sites, etc.). These assurances are based on the "polluter pays" principle: the owner must repair the damage found caused by the company. Depending on its policies, the insurance covers decontamination, damage assessment costs, studies to determine remedial actions and administrative or judicial costs. For more information on business and personal insurance, contact a local insurer today.