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Transferring Risk

Means transferring risk away from you and your business in the event of a catastrophe.
Amber Stitt_Financial Consultant_Business Strategist

When you work towards transferring risk, this means that you are insuring that your business can survive a pandemic or any catastrophe that prevents you from working; either due to an unforeseen event or an illness.

Most of you already have the commercial/business insurance policies that are mandatory as part of owning your own business. When you review your policies, be sure to ask if all necessary endorsements are already included on your basic policies. An insurance broker can help you determine if you are covered for property damage, contents inside, coverage for time lost if the property is damaged as well as coverage for income lost for a period of time if the property needs to be rehabilitated.

If you are a business owner that budgeted for liquid/cash needs from Strategy 1 and acquired the insurance products necessary to cover debts, loans, any obligation at work or within your household, you will survive a pandemic, catastrophe, family illness, losing a loved one or worse.

Typical Must Have Insurance Policies

General Liability Insurance

Business Personal Liability Insurance

Employment Practice Liability Insurance

Worker's Compensation

Key Man Life Insurance (for partners)

Life Insurance to Cover Bank Loans

Individual Umbrella Insurance

Individual Disability Insurance

Business Overhead Disability Insurance

Cyber Liability Insurance


Start by protecting yourself personally. Outside of your home and auto, ask your property and casualty agents about other endorsements (add on policy features) that may be available in addition to the basics. Although this adds onto your expenses, there are typically additional items or situations to insure for. Most common are that people need umbrella insurance to cover personal liability above and beyond the basic, mandatory coverage. Other coverage is additional jewelry coverage outside of the minimums. Many female clients report their engagement ring sets weren't covered up to their actual appraised values.


Make sure you have the basic business policies in place but also inquire about additional concerns. Outside of what is mandatory to have due to your business liability or commercial leases, ask your commercial broker about other scenarios where they have seen others be underprepared outside of personal liability covered by umbrella insurance. Basic policies may not cover materials inside of the salon, time off the job if you are unable to work due to property damage, the computer and other items that belong to others that were damaged due to an event inside your salon space.


Make sure you consider other personal policies. Although the expense may be higher for these, you may want to consider adding on personal life and disability insurance. With life insurance, these policies not only cover your loved ones, but adding on separate policies may protect a partner or serve as collateral on a business loan. Additionally, worker's compensation only covers you if you are injured at work, but not for any other illness or injury that takes you from work. Policies that require underwriting means that they are going to look at your medical history and as that may change, you may become uninsurable or have higher rates. Asking an independent broker about options while healthy will be a good way to find out how you are either going to allocate financial resources to pay for these policies and/or how much more you need to save on top of the other basics. If you skip essential insurance policies, you will need to set aside excess monies on top of your savings, if you forego these policies to self fund emergencies instead.

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