You have done a lot to build your business over the years. You probably have also worked to put away a decent amount of money as a security cushion. However, running the business is always going to cost you, and unexpected costs could easily cause a financial strain. One of the most devastating of these could be the costs of a lawsuit. Here’s why legal action could cost you more than just money in the bank, and a bit of what you can do about it.
Your Business’s Legal Liability to Others
Clients expect businesses to provide them with excellent goods and services. Should something accidentally go wrong, they might try to sue you for your losses.
Lawsuits are nothing to take lightly. First, they could result in significant legal fees. You might have to hire a lawyer, and cover your court costs. Furthermore, lawsuits could result in settlements, either levied by a judge, or reached between the two parties.
Either way, lawsuits might cost a lot of money. For example, a lawsuit against your business for breach of contract might cost, on average, $91,000. A lawsuit involving a customer’s slip-and-fall injury might cost $50,000, and the average judgement in these cases is $100,000.
One hundred thousand dollars is a lot of money no matter which way you cut the pie. If you don’t have this money, then the cost could easily devastate your business. Your financial assets could take a massive hit. Also, if you fail to make the necessary payments, then you might have to surrender physical assets, even the business itself. This is a disaster that no business owner wants to face.
The Benefit of Liability Insurance
Rather than wonder whether you can afford to defend your business against a lawsuit, get liability insurance. It can cover the costs of harm you do to other parties. It can also cover your legal fees.
Liability insurance comes in many shapes and sizes. Most businesses start their coverage with general liability insurance. It can cover the costs of bodily injuries or property damage that you cause to others.
However, you’ll also likely need to expand this coverage with numerous specialty liability policies, like errors & omissions coverage. It pays in cases where your clients allege that your advice or errors caused them harm. Other beneficial coverage might include directors & officers coverage, which can help business owners protect their personal assets in case of a lawsuit against the business.
As much as you might try to avoid mistakes or accidents, they can happen at any moment. So, it is always better to have a plethora of liability policies at your fingertips, rather than take guesses if problems ever do develop. Contact us to get a Boise business insurance quote today.