Best Strategy to Protect Your Small Business in Hong Kong
Starting a business today has become easier than ever. Small businesses in Hong Kong all begin with a great idea and a detailed business plan. Small businesses, also known as SMEs, can be started from anywhere, a home or an office. In fact, many famous companies have begun at home with a laptop and a vision.
However, when starting a business, you may get caught up in the dream and forget the endless risks. Countless risks can negatively affect your business, but with the right strategy, one does not need to fear these risks.
Starting your business itself is a risk which can lead to great success with the right plan. As an entrepreneur, you should be aware of the possible risks and have the well thought strategy to protect your small business.
The best strategy to protect your small business in Hong Kong is with various insurances. Business Insurance can be the shield every business owner needs to protect the company from claims, cyber-attacks, physical damage, business interruption and more.
What Are the Best Insurances for Your Small Business in Hong Kong?
Third-Party Liability Insurances
There is always a risk that a small business’s product, premises or business activity causes a customer or public member injuries or property damage. These accidents are known as third-party accidents.
Third-party accidents can be due to a product defect when the product isn’t safe and has harmed the user or damaged property. Public liability third-party accidents can include slips and falls at the business premises or business activity (including employees) damaging public property. These accidents can lead to third-party lawsuits against the business.
Your small business in Hong Kong could be surprised by these third-party claims at any point. Hence your business needs public liability and product liability insurance – also known as general liability insurance. Both insurances will cover the respected third-party claims, injury or property damage due to the product or business activity.
Employee Compensation Insurance
For your business to grow, you need to hire employees who can help develop your vision and meet goals together. As a business owner in Hong Kong, you are liable for each employee and their safety while working.
Employees may suffer work injuries while performing their duties. Work injuries could occur in any business, although the chances are higher in some industries. The injuries could be a slip in the office to a deep cut in the kitchen. Either way, the employer is legally responsible for paying for all costs related to the work injury.
Every small business in Hong Kong legally must have employee compensation insurance. The insurance will cover the costs related to minor to major work injuries. The insurance will reimburse the medical expenses, salary while recovering and possible compensation pay-outs.
Property All-Risk Insurance
If your small business in Hong Kong works and relies on a business site, you have to acknowledge property risks. Property risk includes damage to business due to a freak accident (fires or floods), weather or business activity.
Some businesses, such as restaurants, cafes, shops or manufacturing businesses, cannot work without their property. The company is liable for property damage and will be responsible for fixing it as soon as possible. A freak accident like an uncontrollable fire can burn down the property and leave the business with a list of expensive repairs.
Property all-risk insurancefor your small business can be a lifesaver financially. The insurance will cover the repair and replacement cost of business property due to an uncontrollable incident. The property can include the property site, fixtures, electronics or any business assets damaged.
Business Interruption Insurance
Property damage can have a substantial negative impact when your business depends on the business property to operate and make sales. Business interruption is the immediate effect of property damage, where the income suddenly stops.
There is no revenue while the business property is being repaired, but there are expenses that still need to go out, like rent, salary, and more. The interruption can financially disturb the business’s future and balance sheet. The longer the rebuilding process, the larger the disruption and more loss.
Your small business in Hong Kong can avoid or reduce the financial impact by purchasing business interruption insurance. The insurance will cover employee salaries, lost revenue, rent expenses, relocation costs & loan payments.
Professional Indemnity Insurance
Small businesses have various liability risks, especially those that provide expert advice and services. There is always an unpredictable chance your small business may make a mistake, error, or neglect while performing the service.
Negligence and errors are the leading cause of liability claims. Clients or customers may allege that the SME or professional’s negligence caused them a large amount of loss. Professional liability lawsuits can result in sufficient financial loss and reputation damage to a small business.
As soon as you launch your business online, you are automatically a possible victim of cyber-attacks. Almost no business is safe from these attacks. Cyber-attacks can result from one phishing click, malicious websites, unsecure WIFI or targeted AI attacks.
Cybercriminals aim to steal data (data breach), lock servers (ransomware) or just infect the business to reach more companies (supply chain attack). Even with the best cyber security, attacks may still slip through. There are many types of cyber-attacks and ways they can sneak into businesses.
Cyber insurance for your small business in Hong Kong is a must to deal with such attacks. The insurance will cover cyber experts’ advice, threat removal, data recovery, informing third parties and financial loss. The insurance is the best way to have a safety net when attacked and for a quick recovery.
Why Your Small Business in Hong Kong Needs Insurance Now?
Your small business in Hong Kong needs the best protection while growing and reaching its goals. Every company could be affected and may have to deal with the outcome of business risks, no matter the industry.
The right insurance(s) is the best strategy for these risks. Insurance may not avoid the risks, but they help deal with the consequences. When your small business has insurance, it can focus on providing the best service or product, rather than claims and financial loss.
Without small business insurance, you may have to pay out of budget for claims and damages. Many small businesses may not have the funds for such expenses, which can reduce the chance of business survival. Having the right combination of insurance will help avoid the vast amount of financial loss that can occur at any point.
If you plan to start your own business or run a small business right now, you need insurance before it is too late.