Asset protection is one of the key elements to a successful business, and this includes even businesses that are classified as corporations. No matter what, one shouldn’t undermine the importance of owning insurance especially since it is remains a vital form of asset protection. So, here are 3 types of insurance available for asset protection, in the event of a lawsuit:
#1: General Business Liability Insurance
Not only is this type of insurance reasonably priced but it will cover a whole range of lawsuits from copyright violation to claims based on personal injury. Probably the best approach to take care of lawsuits such as these is to maintain a high deductible (which would ensure that the insurance is cheaper) along with high limits, which in turn, will work as an excellent way to avoid keeping
excess capital in your firm.
#2: Malpractice Insurance
Depending on the type of business you are in, this type of insurance can be very expensive. What this type of insurance does is cover any mistakes that you or your employees make with clients or customers. Unlike general business liability insurance, this type will only cover claims that have been made from the year the policy came into effect. So, it’s important to maintain continuous coverage.
#3: Umbrella Liability Insurance
Let’s say you have a general liability policy for $ 100000, and a lawsuit asks you to cough up $ 500000. An umbrella liability insurance does just that, by offering the remaining $ 400000. While this type of insurance is reasonable and can extend up to a few million dollars, insurance companies usually require a corporation to maintain all its insurance policies with the company before it offer umbrella liability insurance.