What is the need of Assets and Revenue Insurance?
Among the so-called business-insurance types one of the most important is the Assets and Revenue Insurance that protects the assets and revenues belonging to a particular business. There are many options available for businessmen and knowing these is crucial in order to find the appropriate insurance-type for one’s business.
If people do not have any idea what the assets-insurance refers to, here is a list that can suggest why such an insurance-product may be helpful:
- Owned or leased buildings
- Accessories, equipment, inventory and stocks
- Office equipment (furniture, as well as the whole information-system, including computers, notebooks, printers and many others)
- The business’ valuable documentation (for instance, accounting records)
First of all, the “Building and contents” option protects the major buildings as well as their contents. Any other stocks related to the business are also covered against damages due to fire, lightning, earthquake, storms, explosion, or other similar reasons. This option can be very useful as the loss or damage of the building of one’s business or that of its contents may influence the outcome of the business in quite a negative way.
Second, there is an option that provides coverage for the assets against burglary. This is not the same as the first, which protects against losses due to objective reasons. This second-option, covers for losses that are due to a third party’s housebreaking. So for those retailers or businessmen who have unattended buildings, an insurance referring to robberies may be essential.
Another option that is concerned with the performance of the business, or better to say, with the protection of this performance is called “Business Interruption Insurance” or “Loss of Profits Insurance.” This protects the insured if his/her business is interrupted as a result of property-damage. The insurance helps by providing money for the business’ ongoing expenses and it also provides the business with the anticipated net profit by ensuring its cash-flow.
These primary options refer to the importance of insuring the main premises and assets of a business, and ensuring that the business can maintain its existence from the financial point of view. Besides these, businessmen might think about purchasing the “Fidelity Guarantee” that is concerned with the employees. This is useful as it protects the business against losses that can result from misappropriation of trade secret or other embezzlement by employees. Stealing or defalcation might result in a constraint of the business to close. But this may be prevented by an appropriate insurance.
Finally, there are additional options that can be attached to the main insurance, or can be purchased separately. One of these is the “Machinery breakdown” option which can be useful for those businesses that are dependent on certain machinery, and thus can stop their operations if mechanical and electrical machinery go wrong.
In order to provide a better understanding of how one can choose appropriate business insurance, here is a checklist of what needs to be done. First of all, the owner of a business who is looking for insurance needs to shop around to find the right policy which has the lowest possible costs. Second, the insurance must be purchased from a licensed insurer. Third, one needs to be very careful of the information provided by the insurer. There are certain papers that are obligatory, such as the product-disclosure statement, the insurance-service guide, and the insured can even ask for an advice-statement. Besides these documentation-items, the insured has to make sure that he/she has understood the purchased insurance completely. This involves knowing the exact terms and conditions of the policy, as well as its exclusions and costs. One also needs to be aware what exactly is covered by the insurance.
All in all, business-insurance regarding the assets and revenue covers the unforeseen building-losses, as well as other property-related losses. Moreover, if there is a claim, it provides the needed revenue for the business to continue its operation. There are many optional policies that may be attached to this main insurance; obviously these have additional charges. Businessmen need to consider what kind of insurance their business needs, as well as what particular items need to be covered. This latter is equally important as the items that are to be covered should be listed in the insurance-contract, and it essential for the list to be as comprehensive as possible.