Company insurance is intended to safeguard the financial assets of a firm owner and is a necessary investment for an import and export business.
This article will discuss the primary insurance coverage for import and export enterprises, general liability insurance, as well as additional policies that are appropriate for this industry.
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Import and Export Businesses Need General Liability Insurance
Every firm, regardless of sector, has risks that should be insured. General liability insurance is the most frequent and comprehensive form of coverage that company owners purchase.
General liability insurance covers the following risks:
Physical harm
Damage to property
Medical expenses
Legal defence and decision
Personal and commercial harm
While general liability insurance is not legally needed for companies, operating without it is exceedingly dangerous. If your company is sued, you might face costs in the hundreds of thousands of dollars (or more). The only way to avoid this sort of catastrophe from destroying your organisation is to have an adequate general liability insurance coverage in place to assist pay for these losses.
COMMON SITUATIONS FOR WHICH GENERAL LIABILITY INSURANCE MAY PROVIDE COVERAGE FOR AN IMPORT AND EXPORT COMPANY
Example 1: A prospective investor group comes early for a meeting, before your office cleaning team has time to post a “warning” sign in the freshly scrubbed lobby. One of the investors stumbles on the slick floor, breaks her wrist, requires quick medical treatment, and requests that you pay for her ambulance ride and hospital stay. Her medical expenditures would be covered by general liability insurance.
Example 2: While loading items onto a transport truck with a forklift, an employee inadvertently backs into a client’s fancy automobile. The customer files a lawsuit because the impact causes significant damage to his property. Your legal bills and any court-awarded damages would be covered by general liability insurance.
Example 3: A few weeks after releasing your new corporate logo, a close competitor says it infringes on their intellectual property and threatens to sue. Your legal bills and any awarded damages would be covered by general liability insurance.
Of course, this is not an entire list of risks covered by a general liability insurance policy, and certain situations may result in a specific peril not being covered. To minimise coverage gaps, it’s always better to speak with your agent about the terms of your policy.
General Liability Insurance Cost
Import and export enterprises in America typically pay between $400 and $700 per year for $1 million in general liability coverage.
The cost of your coverage will be determined by a number of variables. Among them are your:
Location
Deductible
Employees’ number
Per-occurrence restriction
The overall aggregate limit
You may be able to get general liability insurance at a lower cost if you buy it as part of a business owner’s policy (BOP) rather than as a separate policy. A business interruption policy (BOP) is a more complete option that covers numerous types of coverage, such as business interruption and property insurance.
Other Types of Coverage Required by Import and Export Businesses
While general liability insurance is the most crucial, there are various different types of coverage to be aware of. Other forms of insurance that all import and export enterprises should have are listed below.
Insurance for Workers’ Compensation
When you run an import and export firm, your workers confront a number of on-the-job hazards. Workers’ compensation insurance is required in most states for both part-time and full-time employees. This coverage covers your workers if they are hurt at work or get sick as a result of a workplace accident. It covers not just an employee’s medical expenditures and missed pay if they need time off to recuperate, but also any disability or death benefits resulting from a work-related accident.
Insurance for Commercial Vehicles
Any car used mainly for business by you or your workers needs commercial auto insurance to safeguard the vehicle, driver, and others on the road in the case of an accident. Choose a policy that not only covers accident-related vehicle repair expenses and medical care for anybody harmed, but also provides enough coverage for any business products you transport in your cars.
Coverage Options for Some Import and Export Businesses
In addition to the policies listed above, your import and export firm may need other forms of coverage based on particular features of your operations. Some of them may not apply to you, so be sure to ask your agent whether policies are appropriate for your company.
Umbrella Insurance for Businesses
While most claims are covered by your general liability insurance policy, certain incidents or lawsuits may be so severe that they threaten to deplete the limits of your main coverage. Commercial umbrella insurance protects you from having to pay for legal expenses and awarded damages that exceed the limits of your main policy out of pocket.
Insurance for Commercial Property
Establishing a thriving import and export business requires a significant initial investment in your own brick-and-mortar building. If your facility or its contents were destroyed in an unforeseen disaster, such as a fire, you may find it challenging to rebuild that commercial property on your own. After an accident, commercial property insurance would cover the cost of restoring or replacing your company facility and its contents, allowing you to recover fast.
Additional Security Measures for Your Company
Although investing in company insurance is simple (and necessary), it should not be your first line of defence. Yes, insurance will reimburse your company for cash losses incurred as a result of an occurrence, but it is much preferable to avoid losses altogether.
With this in mind, here are a few steps you can take to better secure your company:
Make use of legally binding contracts and other business agreements. (We provide free templates for several of the most often used legal forms.)
To safeguard your personal assets, form a limited liability company (LLC) or a corporation. (To discover how to incorporate an LLC or company in your state, see our step-by-step tutorials.)
Keep your company licences up to date.
Streamline the internal procedures of your company. This will eliminate unneeded variables from routine activities and establish a secure, consistent environment in which to do business.
If your company is an LLC, you should check into LLC insurance.