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So you recently started a cleaning business and you are still unsure of how to properly take care of it? When starting a new business, it is always important to consider loss and deductibles. A slippery floor, a strong cleaning chemical, and accusations of theft are just some of the common risks cleaning businesses face regularly.
Knowing and purchasing the right insurance for your cleaning business is just one of the steps to running a good business. It can, however, end up getting very confusing, especially with so many different types of insurance cover available nowadays; but do not worry we are here to help guide you through it!
Importance of Insurance
Though briefly outlined earlier, we need to first elaborate on the importance of insurance before indicating what kind of insurance cover you need for your cleaning business.
It is very likely that your cleaning company, just like many local startups, follows a sole proprietorship business structure. This means that any loss your business suffers is paid directly by you; for example, if a client were to sue for a slip-and-fall accident, and the court orders you to pay forty thousand dollars for damages. Without insurance to protect a small business such as yours, all the money would come out of your wallet. It is important to ask yourself then: are you ready to take that chance?
It should be worth mentioning that insurance can be a great selling pitch as well. If you want to stand out amongst the local competition, insurance indicates a company’s stability. Janitorial bonds can also show clients that they can trust you with their valuable property.
Insurance is often just a great safety net. Though causalities aren’t guaranteed to occur, they could potentially happen; keeping plans in mind for the “maybes” is simply just smart thinking!
Identifying Different Types of Insurances and What They Protect You from
Insurance coverage comes in a variety of forms, and each can always end up more confusing than the last. Oftentimes, insurance companies aren’t direct about which plans to cover what, and due to this ambiguity, there are usually liabilities that are overlooked in the process. However, we will help cover every type of insurance for a cleaning business, so you can save yourself the trouble!
Janitorial bonds are most common amongst local cleaning businesses. They are surety bonds that guarantee to clients that the insurance company will reimburse them if the task is not completed, the contract is broken, or if there is a failure to follow regulations. An instance in which a janitorial bond is required is when an employee is accused of stealing client property; if a fine is required from a lawsuit, janitorial bonds would cover it.
Janitorial bonds would also help cover a much simpler mishap, such as unsatisfactory work done for a client. They mainly appeal to cleaning clients, as if any terms are not followed adequately, clients would reserve the right to be reimbursed. Due to this, janitorial bonds are often openly advertised as they can help bring in more customers.
General Liability Insurance
Similar to janitorial bonds, general liability is also a common type of insurance for a cleaning business as it is the most basic kind of insurance. It is frequently brought first by local business owners, as it covers general risks such as third-party injuries and property damage. This policy covers anything related to customer injuries, advertising injuries, or customer property damage.
For instance, if a vendor or a client is injured by using one of your products or within your office. If you were to be sued in this case, your business will have to pay for a lawyer, medical bills, and other legal expenses. However, since general liability covers third-party injuries, the insurance would be able to pay for third-party medical bills, court-ordered payments, settlements arranged outside of court, and attorney fees!
Another case could be with advertising injuries, where, in case your company copied another company’s logo or slogan, general liability can help with the lawsuit you would undergo. General liability can also help cover accidental advertising injuries from spoken and written defamation and copyright infringement.
Commercial Property Insurance
If your cleaning company uses expensive cleaning equipment, commercial property insurance will cover any damaged, stolen, or lost equipment. Though not seemingly required by everyone, commercial property insurance help save a lot of initial investments you made towards your cleaning business. For small businesses, commercial property insurance doesn’t just have to cover expensive equipment, but can also be used for your inventory.
Commercial property insurance, as the name suggests, covers real estate property along with its contents. It can help pay for the repair or replacement for any losses your company suffers from property damage, loss, or theft.
While your inventory, along with the property you own for it, helps sustain your business, it can be susceptible to financial losses on the other hand. Suffering causalities such as these without insurance does not just lead to a loss in some cash, but could ruin your business entirely; for example, if your office was to suddenly undergo an accidental fire. Without insurance, the repair could leave you bankrupt with no way to make more money due to the lost office space and inventory.
Workers’ Compensation Insurance
Workers’ compensation insurance is built to protect your employees in case of any injury or loss, and is required in most states. If an employee is injured while working, workers’ compensation insurance would help cover immediate medical costs (ambulance rides and emergency room expenses), partial lost wages from not attending work, ongoing medical costs (medication), and death benefits for fatal accidents.
In the case of injury lawsuits, workers’ compensation insurance would help cover attorney fees, court costs, settlements, and witness fees. These instance covers could occur if an employee is injured indirectly by a mishap on your part, and they end suing you because of it.
Workers’ compensation insurance, though helping with potential losses, is mostly useful insurance for a cleaning business due to the trust it builds. With it, employees are more likely to trust employers as it provides evidence that you care for them. Oftentimes, employers use workers’ compensation insurance as an attractive benefit of the job, and it is hence easy to employ and ensure efficiency through it.
Commercial Auto Insurance
If you own vehicles registered under your company’s name, you would need commercial auto insurance to pay for any accidental damages your vehicle may suffer. In the case that you or your employees drive a personal vehicle for your business, then you would need hired and non-owned auto insurance.
Commercial auto insurance can help with property damage, lawsuits, and medical bills along with other expenses. Other than that, it can also pay for a stolen vehicle and damages due to vandalism and weather. Most plans can also just be adjusted to meet coverage. For example, a vehicle travelling far, within an area prone to accidents, could have more coverage than one moving only short distances within a town.
Common Guidelines to Keep in Mind
If you are operating a cleaning business, it is vital to keep accidents to an absolute minimum, as even a slight non-fatal injury could lead to a lawsuit worth thousands. For that very reason, we are here to provide you with some helpful guidelines.
You must catch potential accidents before they occur, and regularly monitoring is the easiest way to do so. Keeping tabs on your equipment and surroundings can ensure that nothing is out of place for causalities or disasters to happen. A safe environment is also beneficial to yourself, so you have no reason not to.
Display Warning Signs for Hazards
Though it may be obvious, you wouldn’t believe how many accidents and consequent lawsuits could have been avoided with a wet floor sign. It is often overlooked due to lack of visible danger, but there is no harm in a sign!
A Camera System
Being able to survey your offices allows looking closely for problems that may pose a risk and act on them before said risk occurs. Recorded videos can become credible evidence that holds up in court for recorded instances as well. The ability to record accidents allows complete transparency of the situation, and you would be able to identify parties involved in damage, loss, or theft.
Overestimate Your Coverage
You should remember that accidents are always unexpected and potentially fatal. Though you may be on a budget, paying for a wider coverage allows you to be prepared for those unforeseeable instances which could deplete your resources more than the insurance could. Similarly, many different types of insurance coverage can also come under one plan sometimes as well which is often a cheaper alternative. For example, you can get a combined policy, of commercial property and general liability insurance, under the name of a business owner’s policy which is often much cheaper.