If you own your own small business, you are well aware that there are risks all around you. While working with a general liability insurance business and having the right small business insurance coverage can help you protect your business, there are additional steps you can take to reduce your risk.
To help limit some business risk exposures, you may need to review and improve your business practices. To get you started, we've compiled a list of the top five practices that increase liability exposure to small businesses and how they can help you when searching for general liability insurance companies.
No business owner wants to face a lawsuit. The good news is that you can take proactive steps to reduce your liability and risk. Keep reading below to learn more and discover why Stampede Insurance is the number one choice for comprehensive small business insurance.
5 Liability Exposures to Small Businesses
Every industry and every business faces varying degrees of risk, both in terms of the likelihood of something happening and the severity of the consequences. Fortunately, identifying potential risks is the first step in implementing a comprehensive risk management plan that can help protect your business for years to come.
Here are five of the most common small business practices that increase liability exposure to help you manage risks more effectively:
1. Working Outside Your Specialty
It's natural for a business owner to want to handle every aspect of the business. Some business owners attempt to serve as their business's human resources representative, accountant, and even social media manager.
However, when the small business owner attempts to perform tasks for which they are not adequately prepared, they expose themselves to various issues such as negligence, risk, damages, malpractice, and potential lawsuits or claims.
Referring clients to someone who has received sufficient training to do the job may be a wiser move than doing the work yourself and hoping for the best. Building relationships with professionals in your field or closely related ones help you to provide trusted referrals while also potentially bringing some your way.
2. Ignoring Regulations
When a company is just getting started, small business owners may be unaware of critical compliance issues or industry regulations. However, ignorance is not a very good defense.
To reduce the risk of running your business incorrectly, you should research the various regulations that apply to your business to avoid penalties, fines, product liability issues, or premises liability concerns.
Always thoroughly research regulations and follow them. To ensure compliance, consult with local organizations, professional societies, and state and federal government resources.
3. Ignoring Customer Complaints
While you may want to avoid dealing with a rude or overly aggressive customer, ignoring complaints is a sure way to get your business into trouble. Even if a customer appears irrational, it is important to listen to their concerns and keep an open mind.
Treat every complaint as an opportunity to learn and improve your company's business practices. To prevent a complaint from escalating into a full-fledged employment practices liability issue, you should investigate the issue and determine whether changes are required to avoid similar issues in the future.
4. Inadequate Insurance Coverage
Business insurance is required matter of the type of business you operate. In fact, it may be legally required in your state and can protect you financially if you are injured on the job.
If something goes wrong, you are responsible as the owner of a small business. Without sufficient insurance coverage, your funds could quickly be depleted, and your business could close for good.
5. Using Insufficient Contracts
For many companies, drafting contracts is an essential part of doing business. These documents can help keep everyone on the same page and ensure that work is delivered on time. The wrong wording, on the other hand, could spell disaster for an organization.
It's common for small businesses to download contract templates from the internet, assuming that a one-size-fits-all solution will suffice. However, depending on your industry, this could expose you to liability risks.
When writing business contracts, consider enlisting the help of a local attorney to help you in developing a template that fits the specific needs of your company as well as the unique risks of your work.
Reduce Your Liability Exposure with Stampede Insurance
Every small business is unique, with its own set of business risk exposures. Being aware of the source of potential liability exposures can help protect your business, maintain its financial standing, and improve your company's reputation.
As one of the trusted general liability insurance companies, our specialized knowledge and connections to some of the top insurance providers in California can provide you with the best service and support your business needs.
We collaborate with our clients to provide the best in devoted service for their commercial insurance needs, and we are proud to serve clients across the nation who are licensed in multiple states.
To learn more about how we can help you with liability insurance policies, one of our devoted business partners and knowledgeable agents will find you a comprehensive solution for all of your insurance and business needs. Complete our online form or contact us at 888-306-7887 at Stampede Insurance Services today!
