Intro: 5 Reasons Why You Need Insurance for Your Small Business in 2022
As an entrepreneur, one of your priorities should be finding ways to protect your business and make sure that you’re financially stable in the future.
While you probably already have some insurance, like health insurance or homeowners’ insurance, it’s important to make sure that your business has the best insurance possible so that you don’t have to worry about any hiccups in your financial plans down the road.
Here are five reasons why you need insurance for your small business in 2022.
1) Protect your assets
All small businesses are uniquely vulnerable. If one of your employees gets hurt on a job site, or a customer slips and falls in your store, you could be liable.
However, most small business owners don’t realize how vulnerable they are until they experience it firsthand and that’s when it’s too late to plan ahead.
2) Avoid fines
Since small businesses are often run by sole proprietors and not companies, there’s an extra layer of legal protection. In addition to paying state income taxes, owners of small businesses can be hit with fines if they fail to abide by certain tax rules.
To avoid penalties, familiarize yourself with tax regulations that apply to your small business type and work with a CPA who understands them well. If you do end up getting fined, do your best to dispute it; some fines are appealed successfully.
3) Get tax benefits
As an independent business owner, you can’t typically deduct many of your business expenses, like work-related clothing or commuting costs.
But if you buy a specific type of insurance policy one that covers employee injuries you can deduct those costs from your taxes.
It’s not just disability insurance, either: If you provide life insurance to your employees as well, even if it’s not a requirement by law, you can deduct those premiums as well.
4) Avoid the risk of lawsuits
With consumers getting more aware of their rights and companies being held to higher standards, lawsuits can be a serious risk.
If you’re sued, it can cost tens of thousands even hundreds of thousands of dollars to defend yourself.
This is money that you could use toward growing your business.
5) Save time with contracts
The number one reason small businesses need to invest in legal services is because of how complicated a seemingly straightforward business matter can become.
Whether you’re seeking a contract with a client or looking to make sure you don’t get sued by your employees, having an attorney on speed dial can be life-changing.
And, yes, depending on your state, you might be able to do it all yourself but that doesn’t mean it’s going to turn out well.
We hope you enjoyed our article about 5 reasons why you need insurance for your small business in 2022. We hope that this post has helped you understand the importance of protecting your business and the many ways that you can do so.
If you have any other questions or concerns about getting insurance for your small business, please reach out to us anytime. Thank you for reading, we are always excited when one of our posts is able to provide useful information on a topic like this!
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