Every business, big and small, faces risks on a daily basis. Though the risks are always there, you can combat them by planning ahead and putting security measures in place. Let’s look at five of the biggest potential risks and what you can do to minimize them.
1. Legal risks: Today’s litigious society is the perfect breeding ground for a variety of lawsuits. Your business can be sued for poor product performance, third party injuries on the premises, copyright infringement, wrongful termination, libel, harassment and a host of other incidents, whether grounded or frivolous. The best way to combat this risk is to make sure your business is operating legally and ethically. Test products before selling, keep the workplace clean and tidy, buy all necessary rights and purchase business liability insurance that will cover legal and medical fees.
2. Reputation damage: Social media makes it easy for customers and competitors to say nasty things about your business. The best way to combat this risk is to closely monitor your online presence and promptly address any upset customers to resolve the situation. Similarly, quality customer service can eliminate many issues. It’s better for a customer to say “I had a problem with Company X, but I feel better now that they worked with me to fix their mistake” than it is for a customer to say “I hate Company X because I had a problem.”
3. Property damage: Natural disasters, storms, fire, theft and vandalism can all contribute to loss of property, which can mean building structures, inventory, equipment etc. If damages are severe, your business may lose profits if the company is unable to operate for an indefinite amount of time. The best way to combat this risk is to beef up your business’ security and to purchase business property insurance and business interruption insurance.
4. Cyber risks: Digital data can be stolen by hackers, lost in a power surge or even leaked by fraudulent employees. The best way to combat this risk is to install top-of-the-line firewalls (even if that means hiring an online security consultant) and to purchase cyber risk liability insurance.
5. Loss of a key employee: The illness, disability or death—whether sudden or foreseen—of a key employee can be detrimental to your business. Both temporary and permanent absences can significantly impact daily operations and profitability. The best way to combat this risk is to plan ahead for this possibility in your yearly business plans and to purchase key employee insurance.
We’ll help with all of you coverage needs. Call Sovereign Financial Group at 708-713-4456 for more information on Flossmoor business insurance.