Victoria Marumo

Hello and a warm welcome back to another chapter of this insightful blog. Winter is creeping in and I hope you are making preparations to avoid getting caught up in the chills. Likewise, in business, there are precautionary measures that need to be taken against potential harm of the business in the near future hence our topic for today. For those of you who are joining this site for the very first time, please take time to read and reflect on previous articles to better understand the chapter, we are on now. Happy reading!

Business Insurance coverage protects businesses from losses due to unforeseen events during the normal course of business. There are many types of insurance i.e., coverage for property damage, legal liability and employee-related risks. Companies evaluate their insurance needs based on potential risks, which can vary depending on the type of environment in which the company operates. Please note that business insurance can be provided by all insurance providers in the country and banks through insurance plans designed as per the bank profile.

Any legally registered business can be insured as there are various insurance plans within different organizations that offer insurance services. That is to say, for example, the insurance and payment plans of a law firm will vary with those of a pre-school business or retail clothing store. It is up to a business owner to find out what works best for them based on the nature of the business.

Types of Business Insurance

Business Insurance is no longer limited to big corporate organizations, rather, there are opportunities for small start-up owners as well.

Professional Liability Insurance

Professional liability insurance insures against negligence claims that result from mistakes or failure to perform. As earlier alluded to, there is no one-size-fits-all insurance plan. Each industry has its own unique concerns that should be addressed.

Property Insurance

Pretty much self-explanatory, property insurance covers equipment, signage, inventory, and furniture in the event of a fire, storm or theft. In the event that your area is at high risk of natural disasters like floods and storms, it is imperative to acquire a separate policy.  Where expensive high value personal property is involved, it is often covered by purchasing an addition to the policy called a “rider.” If there’s a claim, the property insurance policy will either reimburse the policyholder for the actual value of the damage or the replacement cost to fix the problem.

Product Liability Insurance

Which Product liability insurance is especially important for businesses which manufacture products to sell.? Mistakes/ human error can happen and any business can find itself tangled up in a lawsuit due to damages caused by its products. Product liability insurance protects a business in such cases.

Vehicle Insurance

Any vehicles used for business must be fully insured. At the very least, businesses should insure against third-party injury, but comprehensive car insurance will cover the vehicle in an accident, as well. If employees are using their own cars for business, their own personal insurance will cover them in the event of an accident. A key exception to note though, is if a person is delivering goods or services for a fee, including delivery personnel.

Business Interruption Insurance

This is a type of insurance that is especially applicable to companies that require a physical location to do business, such as retail stores or manufacturing facilities. Business interruption insurance compensates a business for its income loss during events that cause a disruption to the normal course of business. For example, the year is 2020 and Covid 19 has emerged, completely shutting down business unexpectedly. There are policies in place to cover and or compensate businesses that were hit hard by the pandemic. This is relevant even for future catastrophes, so one has to make sure they insure their business against future interruptions.

In the past year since the advent of the COVID-19 pandemic, there have been doubts and questions about whether this form of coverage includes pandemic-related losses. However, it depends on the terms of the policy and how the insurer, and possibly the courts, interpret them.  A typical business interruption policy will include property, liability and business income coverage (which caters for employee salaries as well). So, you’re covered against losses stemming from damage to your business property or its contents caused by a covered peril, as well as personal liability claims or loss of income if the business has to close temporarily.

Managing Pandemic-Related Losses Due to Business Interruption

Credits to Rebecca Lake United States of America

If you run a business that’s been affected by the coronavirus pandemic or any other viral outbreak and you have business interruption insurance, review your coverage. Specifically, check the wording of your policy to see if pandemics are either explicitly included or excluded. In situations where coverage regarding pandemics is unclear, you can reach out to your insurance agent or company directly for clarification. If you are covered, you can then ask about the next steps for filing a claim under your policy. This may require you to provide details about your losses, along with supporting documents showing how much your business has suffered financially as a result of the pandemic. If your insurance company isn’t able to provide a satisfactory answer, you may need to talk with an attorney to discuss whether bringing a lawsuit is necessary or advisable.

Bringing It Closer To Home

According to the Botswana Investment and Trade Centre (BITC) facts sheet, Botswana aims to become a world-class hub for cross-border financial and business services into Africa and globally. As one of the most affluent economies in Southern Africa with a robust growth outlook, Botswana?s wealthy population presents a sizeable market for financial services such as banking and insurance, relative to most other regional economies. Botswana?s international Financial Services Centre (IFSC) supporting regulatory framework provides regional and international banks, international business firms, insurance companies and investment funds an advantageous platform to penetrate new markets or consolidate their position in sub-Saharan Africa?s (SSA) fast-growing markets.

In addition, Botswana has the 3rd best Network Readiness Index overall score in Southern Africa. The country thus has the third highest propensity in the region to exploit the opportunities offered by ICT. Botswana?s life insurance sector is significantly larger than the non-life sector. The life insurance sector is also expected to grow faster than the non-life sector over the next five years. Botswana?s life insurance sector is one of the largest and best developed life insurance markets in SSA.

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Miss Victoria Marumo is a journalist with a distinctive and creative voice. Her avid reading complements well with her writing in providing captivating information on business topics.

Writer: Victoria Marumo