In a world with an increasing trend towards a focus on internet-based businesses, it is becoming more important to insure your online company as you may be unknowingly exposed to a vast number of risks. This is a very niche market in the area of business insurance and finding the right policy for you can be a struggle. A few hours of research will pay dividends, though, and give you the peace of mind of covering the myriad risks which you are exposed to when running an e-business. Here are a few reasons why you need to be insuring your online enterprise:
- Security: This is an obvious risk, but one which needs to be insured regardless, given the sensitivity of data contained within an online business. If you run a successful e-business, you will most likely have the personal details of a vast number of customers—including bank account details, addresses etc. If this kind of information gets into the wrong hands due to security breaches on your website from third parties, the ramifications for you can be huge. Just one customer taking legal action due to mishandled data can result in you having to pay thousands of dollars in legal fees. Having your business adequately insured can cover the risks involved in cyber attacks on your website and the stealing of customer data.
- Intellectual Property Rights: Anyone with an online business can be exposed to this risk without knowing it. Online entrepreneurs will often use images or videos on their website without thinking of the associated intellectual property rights that the image owner or creator has. Displaying a copyrighted image on your website or using music without the owner's/creator's permission can result in disastrous consequences. The larger your online business, the more you'll have to pay out in damages if any potential copyright infringement is flagged. Having this risk insured can substantially reduce the risk of ruining your company and your own finances.
- Product Liability: A lot of successful online businesses sell physical goods. Many smaller online retailers sell products such as customized jewellery, electrical goods and food items. The exposure to risk is huge here—a small child choking on one of your jewellery items, for example, can result in enormous medical expenses. Having to compensate somebody for damage because of your goods is an extremely messy situation to end up in. Having this sector of your business insured thorough product liability is vital as accidents do happen and it can give you peace of mind knowing that you won't be liable for any damages.
Online business insurance is both an evolving and complex market. Knowing the risks you are exposed to through your online enterprise is a key step and after that it is important to get appropriate cover. A few hours of research into getting the correct can be very rewarding in the long run for your e-business.
You should also reach out to a local insurance company for additional info on the plans they offer.