You’re probably wondering why you need a small business insurance package in Hong Kong? The business environment is full of uncertainties and incidences that could potentially hurt your business at some point.
It is critical that as a business owner, you take proper steps that will help you cushion your small business against any potential risk like supply chain interruption, physical damage to your assets, work accidents, civil commotions among others.
This is where your business insurance coverage comes into play. Without the right one, the probable outcomes of these incidents could have drastic and far-reaching effects on you business.
Question #1. How can my business avoid risk?
An unmitigated risk could potentially drain you financially and it is important to take some steps to prevent it from happening again.
There are a few ways you can go about this. You can choose to avoid the risk of engaging in an activity if it has the likelihood of happening again to avoid such instances. If avoiding it is not an option, then mitigate it.
Natural disasters are often destructive and inevitable, especially in Hong Kong. If your equipment or stocks are at risk, make sure you have an emergency plan in place to reinstate your stocks within a short time frame.
You will also have to make sure you have enough cash flow to go through this difficult time. If you don’t have it, don’t bear the risks and transfer it to a third party such as an insurance company.
Question #2. What is a business insurance package?
It is simply an insurance policy that includes basic insurance coverage for small businesses. It includes business interruption (additional cost of working), property damage, personal accident, money, neon sign, glass breakage, fidelity guarantee, employees compensation, public liability, machinery breakdown and goods in transit.
*Note that different insurance providers have different names for their insurance packages.*
Question #3. Do I really need this insurance bundle for my business?
Employees' compensation insurance is the only mandatory one in Hong Kong. Get it sorted at the same time as you get basic protection for your business. It will save you money to have all your insurance policies with one insurer. And you will also save time when handling and renewing your subscription.
Question #4. What are the downsides of having one insurance policy made of several coverages?
This bundle includes insurance coverage that is different in scope and nature. They have specific limits, deductions, and exclusions. Having all these elements in one package with little understanding of the clauses could make it very challenging for you to read and understand.
Also, having an all-in-one business insurance package implies that there is little room to tailor it to fit all the specific requirements your business may have. If your business needs additional insurance such as product liability, cyber insurance and professional liability, take separate policies.
Question #5. How do I choose the best insurance package?
Firstly, ensure that you list your business needs in terms of property and liability risks. For instance, if you think that your business is sensitive to in-house crime because of the cash you may have or the goods stored, it will be worth your money to choose a package that will offer you an extensive plan to cover fidelity of employees.
Secondly, always adequately declare all the sums insured for your business because when calamity strikes, an insurance expert will confirm whether your business is under-insured, and this may decrease your indemnity claim.
Thirdly, let your public liability cover all your business needs and do not limit it to your premises only. Fourthly, always inform your insurer about any material changes in the nature of your risks, like office renovations. Last but not least, let your insurance agent be only a phone call away to be of service when the need arises.