Springfield Small Business Insurance: Small Business, Big Liability?

Jan 6, 2016 8:21:00 PM

A benefit of being a smaller business in Springfield is that you can keep many of your costs low until you expand and have more cash available. At first glance, it might seem like you can keep your small business insurance costs down by choosing policies with low cover limits or even passing on some forms of cover altogether. When it comes to liability insurance, however, your needs may not be proportional to the size of your business.

Small Business Insurance Springfield

Springfield Small Business Insurance: Breaking It Down

Understanding Risk

Risk is not simply the likelihood of something happening. Instead, risk combines the likelihood of something happening with the resulting costs and damages.

Bigger firms may have more opportunities for expensive claims to arise, but they often have the ability to handle any expenditures in excess of their coverage. Small businesses, on the other hand, deal with fewer people and have the perception of having a lower chance of getting hit with a liability claim. However, they typically cannot afford to pay damages that exceed their liability limits associated with their small business insurance, giving large claims the ability to financially cripple them. In other words, small Springfield businesses have more to lose.


Massachusetts state law is relatively favorable to Springfield businesses: You only have to pay a liability claim if you're held responsible for more than 50 percent of damages, and any payout is reduced depending on the apportion of blame. However, this can still be a huge amount of money. If you're held responsible for somebody's injury, you may have to pay damages that cover their medical bills, distress, loss of earnings and legal fees, which could be hundreds of thousands of dollars (not covered by your standard small business insurance).


Carrying adequate liability cover isn't just about mitigating the risk of paying damages. Depending on location and jurisdiction, you may have to carry some form of liability insurance to be allowed to supply or work on contracts for public entities. Having adequate liability insurance can also be a selling point to clients, assuring them that you can pay for any damages.

The Bottom Line for Small Businesses

However big or small your Springfield business, not having adequate liability insurance is like playing the lottery. You may think that the chances of being hit by a claim may be low, but if the worst happens and you aren't covered, it could ruin your business. Getting suitable small business insurance coverage isn't a gamble: It's an investment in your business's security.


Are You Protected?


Edward J. Adamczyk

Written by Edward J. Adamczyk

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