A Quick Guide to Insurance 101 for a Tech Start-Up
Starting a new business or start-up is never easy because of the risks associated on different fronts. The life of an entrepreneur is always in a dilemma because of the financial instability in the starting days. There is always the risk of losing your investment, even after making all the efforts and hard work. And when you are founding a tech start-up, there are many physical and virtual threats and liabilities waiting around the corner.
Though there are many financial challenges and threats on your road to success, there is always a way to control and do something about it by taking the right business insurance. Investing in the right insurance to protect your business start-up can be critically important to your success. A tech entrepreneur needs to take a comprehensive look at the risks a tech start-up faces and what’s legally needed to cover all the associated liabilities and protect the company.
Many insurance companies offer business insurance policies to new as well as established businesses. It provides them protection against business risks, losses, theft, cyber-attacks, and lawsuits due to some mishaps. With the right business insurance coverage, you will ensure that a your business doesn’t go under due to an unforeseen circumstance that was beyond your control. Here’s a quick guide to insurance 101 for a tech start-up to help you determine what liabilities you need to cover with a business insurance policy.
If you work with hired staff, contractors, suppliers, or even temporary staff, you are required to get employee liability insurance. It protects your business from any claim made by your client for any kind of loss or damage due to the negligence of your employees. It is a legal requirement in Dubai. However, you must get this coverage plan as a necessity to avoid hefty fines and lawsuits in some cases.
Disability insurance or worker’s compensation insurance
Worker’s compensation insurance protects the rights of your employees in case they suffer from any injury or accident while performing their duties. It provides a source of income to your disabled employees in the time when they are not able to work or perform for your company.
Errors and Omissions Insurance
Errors and Omissions Insurance policies cover claims made by your customers for “glitches” “errors” in your products or services. For example, if you are a web service provider and some of your clients face any professional loss due to malpractice of technical issues in your web product, he may ask for a claim for the losses. It is where E&O insurance covers this kind of business claim against your company.
Cyber-attacks are a serious threat to businesses, especially tech companies and web service providers. And according to a survey, nearly half of all cyber-attacks are made on small businesses and start-ups. So, when you are founding a tech start-up, take this threat seriously as it can result in online theft of your data and business information. Cyber Liability insurance covers losses related to data breach incidents.
Business content insurance
The loss of office essentials and supplies such as laptops, printers, and other equipment can cause significant business disruption on many fronts. It is where business content insurance covers all your losses in the event of any theft or lost office equipment.
These are some common insurance coverages you need in your business insurance as a tech entrepreneur. When you are offering technical advice, providing web services, publishing online content, or dealing with cyber security, these coverage plans help you protect your business in the event of any mishap. Do all your research on how to calculate premiums and claim procedures before deciding on the right insurance policy for your start-up. Work with an experienced insurance broker to determine your business liabilities and find the right business insurance.