Business Insurance

You know that business theft is inevitable for many businesses, and is at best a serious threat for any small business. You've implemented business security measures to minimize your losses. You're carefully screening employees before making hiring decisions to cut down on your employee theft risk. Now, how can you further protect yourself when losses from business theft do occur? Get business insurance (or more specifically, theft insurance)!

Types of Business Insurance
Business owners don't always fully understand the way small business insurance works. Because of this, you may think you're covered with small business insurance for instances of theft, but chances are that you're not.

Having general insurance, like business liability insurance, may cover you if someone is injured on your business premises, but it won't offer theft insurance. Neither will certain types of business insurance designed to cover property. When you're looking into small business insurance or commercial insurance, you'll need to go beyond liability insurance and look for something called business theft insurance (sometimes called employee dishonesty insurance). Having this specific form of coverage is the only way you can rest assured that you'll be able to recover losses in the event of theft.

Who Needs Business Insurance?
You do! It doesn't matter if you run an office of 200 employees, a corner shop managed solely by your family, or a home-based business involving little more than you and your computer. You're at risk for at least one type of business theft, and theft insurance on top of your regular small business insurance or liability insurance can help you recover losses if, or when, it happens.

Don't make the mistake of thinking "It could never happen to me." It can. Let's look at the examples mentioned above.

Joe runs a successful software development company. He has 200 employees and is covered by theft insurance. One day his top designer, Sally, has a falling out with her superior. She quits almost on the spot, but not before backing up copies of all of her designs for Joe's highly-anticipated game release. She takes the designs to his biggest competitor, where they're working on a competing program for launch. Joe was a victim of internal business theft in the form of intellectual property theft, something normal business insurance might not cover. While the situation might be a marketing nightmare, at least Joe was smart enough to have employee dishonesty insurance / theft insurance, so he'll be able to recover some of his losses, if he incurs them.

Bill and his family run a local sandwich shop. Bill has basic small business insurance, but no commercial insurance or theft insurance. He leaves his two kids in charge of the store on a Friday night. A bunch of their classmates from college come in after a sports game on campus, and pressure Bill's kids to cut them a discount. They cave to the peer pressure and under-charge for the orders. Bill was also a victim of employee theft, through a process known as "sweethearting." Bill figured that since his shop was in a safe neighborhood and he felt he could trust his family to run the store, he wouldn't need business theft insurance. Now Bill has to eat the loss.

Maggie is a freelance Web designer, working alone from home. She has no business insurance at all. Maggie uploads design mock-ups to a private folder on her server, where clients can login to view and approve design concepts. Maggie's server isn't secure, and someone is able to access what she thought were private files. They've taken her design mockups, coded them, and sold them off as Web templates to multiple buyers - making the designs worthless to Maggie's clients. Maggie was a victim of external business theft, although also intellectual property theft similar to what Joe experienced. Maggie never considered the possibility that she could be a victim of business theft, so she didn't get theft insurance or small business insurance covering these losses. Now the client (rightfully) won't pay for the designs that were lost due to her negligence, and Maggie loses any compensation for the time put into these designs that she won't be able to use.

Avoid being the next Bill or Maggie. Go through your small business insurance and theft insurance information today, and make sure you're covered in the event of either internal or external theft with adequate business theft insurance.