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There's no denying that small businesses are the nerve center of the U.S. economy. Nearly 30 million small businesses across the U.S. are currently in operation and more than 50% of the working population works in small business.
For entrepreneurs to thrive, a small business has to be firing on all cylinders. However, all it takes is one liability incident that can erase the financial gains made over the course of a year at best, or a lifetime at worst.
The following are several proactive measures you as a business owner can take to protect your company from liability:
Form a limited liability corporation
There are several designations that a business can establish itself as, be it a sole proprietorship, partnership or corporation, among others. From a standpoint of liability, perhaps the best is forming a limited liability corporation. In addition to tax incentives, an LLC business structure restricts what a business owner is responsible for in the event of a lawsuit. SBA has additional information regarding the positive aspects of LLC formation.
Train employees
It's important that employees learn the ropes of the business through training. This not only supplies them with the information they need to know to do their job correctly, but it can also provide business owners with liability protection should a worker sustain an injury.
Additionally, training can better inform staff about how to react should there be a workplace emergency. According to a survey by online job search engine CareerBuilder, nearly 25% of workers wouldn't know what to do if they were presented with an urgent situation on the job.
Have policies in place
To protect employees and limit liability, having in-depth harassment policies is essential. As a business owner, you should also have policies in place on how to deal with a public relations disaster. Having a good lawyer representing your company before problems arise is very important. Hiring a good lawyer is just as important as getting insurance and can help keep your business out of harm's way.
Avoid controversial questions when interviewing
When a position opens, the interview process is perhaps the most important element to finding an effective replacement. However, in business owners' bid to find the perfect person for the job, it's important to remember not to ask questions that are inappropriate, like political affiliation, religion, marital status or financial circumstances. An estimated 20% of employers have unwittingly asked a question when interviewing a candidate for a job that they shouldn't have, according to a separate CareerBuilder poll.
Develop business interruption plan
Only 17% of business owners in the U.S. have put together a business interruption plan. This kind of preparation lays out the groundwork for how to keep a business viable after a natural disaster or lawsuit threatens its survival.
A standard component of business insurance is liability insurance. For more details on how it can protect your company from financial losses, speak with your local Selective agent.
For entrepreneurs to thrive, a small business has to be firing on all cylinders. However, all it takes is one liability incident that can erase the financial gains made over the course of a year at best, or a lifetime at worst.
The following are several proactive measures you as a business owner can take to protect your company from liability:
Form a limited liability corporation
There are several designations that a business can establish itself as, be it a sole proprietorship, partnership or corporation, among others. From a standpoint of liability, perhaps the best is forming a limited liability corporation. In addition to tax incentives, an LLC business structure restricts what a business owner is responsible for in the event of a lawsuit. SBA has additional information regarding the positive aspects of LLC formation.
Train employees
It's important that employees learn the ropes of the business through training. This not only supplies them with the information they need to know to do their job correctly, but it can also provide business owners with liability protection should a worker sustain an injury.
Additionally, training can better inform staff about how to react should there be a workplace emergency. According to a survey by online job search engine CareerBuilder, nearly 25% of workers wouldn't know what to do if they were presented with an urgent situation on the job.
Have policies in place
To protect employees and limit liability, having in-depth harassment policies is essential. As a business owner, you should also have policies in place on how to deal with a public relations disaster. Having a good lawyer representing your company before problems arise is very important. Hiring a good lawyer is just as important as getting insurance and can help keep your business out of harm's way.
Avoid controversial questions when interviewing
When a position opens, the interview process is perhaps the most important element to finding an effective replacement. However, in business owners' bid to find the perfect person for the job, it's important to remember not to ask questions that are inappropriate, like political affiliation, religion, marital status or financial circumstances. An estimated 20% of employers have unwittingly asked a question when interviewing a candidate for a job that they shouldn't have, according to a separate CareerBuilder poll.
Develop business interruption plan
Only 17% of business owners in the U.S. have put together a business interruption plan. This kind of preparation lays out the groundwork for how to keep a business viable after a natural disaster or lawsuit threatens its survival.
A standard component of business insurance is liability insurance. For more details on how it can protect your company from financial losses, speak with your local Selective agent.
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- Puts your needs first.
- Finds the right coverage at the best value.
- Gets to know you to help you manage risk the right way.
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