Insurance is often compared to a shield and an umbrella because insurance is there to protect your interests. There are a great many different kinds of policies. You have a policy for your home and one for your car. Perhaps you own a business and therefore have a commercial policy. While insurance is a promise to pay, providing peace of mind during a claim situation it is also an important contract outlining and describing coverages, limits and exclusions. When something does happen, an accident, fire or some other kind of incident, it’s important to know that you have the best policies in place; Coverages and limits, broad enough and high enough respectively, that will protect you against whatever claim has been leveled against you, your family or your business.
For most of us, we don’t think about insurance… Until we need it. At some point, as winter winds and snows approach, you’ll be asked to keep your sidewalks clear and your steps salted. These are good reminders, but perhaps you’d like to know why these are important from an insurance point of view?
At Erb and Erb we strive to help our clients minimize or avoid risk. What is a risk? It’s a situation involving exposure to danger. For insurance professionals, danger is an accident or an incident which could result in personal injury or property damage. Liability is a person’s, or a company’s, level of responsibility for something. For example, as a homeowner you are responsible for maintaining your sidewalk during the winter. Shoveling the snow will reduce the risk of someone slipping and falling and getting injured on your stretch of the sidewalk, but it will not eliminate your liability for the sidewalk because you are still responsible for it. Another example might be pet ownership. Say you have a dog as a pet. Taking the dog to obedience training will reduce the risk of it biting someone, but you will still have liability as long as you own the dog.
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The same concept holds true for vehicle ownership. Taking a driver training course reduces the risk that a young or new driver will get into an accident and this is reflected in reduced insurance premiums. This is a good thing! We highly recommend any new driver take driver education. However, if the person owns a car they’re still liable for how that car is operated, while they drive it or when they let someone else drive it. Even if you’ve parked the car and don’t intend on driving it at all, you still are liable if a child plays on it and gets hurt.
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Business insurance is even more complex. From boiler and building insurance, to product recalls and business interruption insurance. As new threats emerge new kinds of insurance are developed.
Related Read: What Kind of Liability Coverage Does Your Business Need?
Cyber-risk insurance is fast becoming an important part of every company’s risk management strategy. If you own a business have you considered what kinds of personal client data you collect and store? The more you client data you accumulate, such as credit cards, personal identification numbers and addresses, the greater your responsibility to maintain and protect that data becomes. If something should go wrong your company is liable for potential damage to your clients’ banking, finances and credit score. That’s not a situation any company would like to be in and your company could experience a significant financial impact. That’s why a good cyber-risk insurance policy is designed to provide best practices to reduce your company’s risk as well as to deal with the aftermath of a privacy breach.
Related Read: Erb and Erb’s IT Insurance Whitepaper – Laws, Risks, Prevention and Protection
So it follows, the more you own the greater your liability exposure. You have a responsibility, a liability, to maintain whatever you own. That’s why an independent insurance broker can provide a review of your needs and can make recommendations that best suit your situation. A good broker will help you to reduce and manage your risk with a good insurance policy and helpful advice. Here at Erb and Erb Insurance Brokers Ltd. we take the time to understand your interests, whether they be personal, commercial, or financial so you’ll know what options you have. You’ll know exactly what liabilities you have and how to protect them.
Thanks for reading. Have any comments? We’d love to read them!