How to Insure a New Business

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Your new business may encounter problems as it begins to promote goods and services in the community. A flood or fire in your production facilities could damage your inventory or one of your employees might fail to place a warning on an electronic product. You can insure your new business against liability and loss of property with the right insurance policy.

Become conversant in current business insurance issues by reading the right literature. Visit TSBIC.com for answers to frequently asked questions about small business insurance (see Resources below). Some business magazines also feature resources for grading the best and worst insurance companies on the market today.

Review the health, dental and auto insurance offerings of a potential business insurance provider. Most forms of business insurance do not provide for employee benefits. If you can find a deal on a wide range of insurance policies from one carrier, you can simplify the claims process.

Search for specialized insurance policies if your new business requires coverage specific to a particular industry. Farms, construction companies and real estate firms require insurance coverage that exceeds the financial limits of general business insurance.

Determine the presence of liability insurance before you allow a company to insure your business. Liability coverage limits the amount of legal action that a consumer or competing company can take against your employees.

Avoid damage caused by natural disasters with business interruption insurance. When you find business interruption insurance, you insure yourself against damage done by floodwater, fire and earthquakes. These types of policies focus on protecting your inventory and equipment from irreparable harm.

Protect your company's vehicles with business vehicle insurance. Like regular auto insurance, business vehicle coverage helps your company recoup losses from car accidents and vandalism. You should note that insurance restrictions are high for business vehicles because they are only meant for use during office hours.




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What is CIF(Cost, Insurance and Freight)?

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“Cost, Insurance and Freight" means that the seller delivers when the goods pass the ship's rail in the port of shipment.

 

The seller must pay the costs and freight necessary to bring the pods to the named port of destination BUT the risk of loss of or damage to the goods, as well as any additional costs due to events occurring after the time of delivery, are transferred from the seller to the buyer. However, in CIF the seller also has to procure marine insurance against the buyer's risk of loss of or damage to the goods during the carriage.

 

Consequently, the seller contracts for insurance and pays the insurance premium. The buyer should note that under the CIF term the seller is required to obligation insurance only on minimum cover1. Should the buyer wish to have the protection of greater cover, he would either need to agree as such expressly with the seller or to make his own extra insurance arrangements.

 

The CIF term requires the seller to clear the goods for export.This term can be used only for sea and inland waterway transport. If the parties intend to deliver the goods across the ship's rail, the CIP term should be used.





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