According to a research by Hartford, at the time of buying an insurance policy, most small business owners who might have a flat for rent in Patna don’t think that they will sustain any loss. To them, insurance is like protection against unconventional incidents. But in reality, losses may occur more frequently than what they could expect. They are very prone to incur a liability or property loss within coming 8 to 10 years.
Common types of claim
Here are the 10 most common types of insurance claims made by small businesses as concluded from the data submitted by different insurance companies.
- Theft and burglary – About 20 percent cases belong to this type. Most of the time, the perpetrators of such crimes are outsiders and sometimes dishonest employees.
- Wind and hail damage – About 15% claims fall into this category.
- Water and freezing damages – 15% of the total claims belong to this category. Such claims include roof damage from ice and snow, and damage owing to frozen pipes.
- Customers slip and fall – 10% of the total claims fall into this category. Almost all small businesses incur this type of claim. Companies that have customers who regularly visit their office premises or work sites are more prone to slip and fall claim.
- Fire damage – About 10% of the total claims fall under this type. Fire causes property damage to a serious extent though policyholders often underestimate the destructive power of fire.
- Product liability – Less than 5% of all claims come under this category. Vulnerability of a business to incur this type of claim depends of different types of factors including the products’ nature and warranties that the company makes while selling the product.
- Customer injury and damage – Less than 5 percent of the claims belong to this type. If a customer has a bodily injury or any property damage owing to an accident that doesn’t involve a slip and fall. For example, a customer comes to your office and gets injured in the office if a heavy floor lamp falls over and hits her in head.
- Struck by any object – This type of claim covers only 5% or even less of the total claims.
- Vehicle accident – This also covers only 5% or less of the total number of insurance claims. A vehicle safety program may help preventing incurrence of this type of claim.
- Harm of reputation – This type of claim covers 5 percent of total claims. These are generally third party claims against small business owners for acts such as libel and slander. Plaintiffs complain that their reputation was affected negatively by such acts.
Some claims occur more frequently than others. Apart from the frequency, the insurers are also concerned about the severity and size of the claim. Here are the 10 claims in terms of average costs from highest to lowest.
- Reputational harm
- Vehicle accident
- Product liability
- Customer injury and damage
- Wind and hail damage
- Customers slip and fall
- Struck by object
- Water and freezing damage
- Theft and burglary
These are the overall information about claims incurred by small business owners.