When you’re running a small business, you don’t exactly have a lot of room for error. You need to keep tight control of your finances to ensure you can cover anything from vendor to lease costs. However, if you or an associate is involved in a crash, that can quickly cut into your business finances. That’s why it’s so critical to be proactive about protecting your business in case of an accident.
Read on to learn how a crash can impact your cash flow, and what you can do to be prepared.
Why Crashes Are So Debilitating
You may be part of a small team running your business. And as a result, you’ll be wearing many hats to ensure your business is operating efficiently. One crash can derail your efforts with everything from customer service and marketing to vendor meetings, all of which are crucial to helping your business thrive.
If you’re stuck recuperating from injuries, you could miss payment deadlines or fail to respond to customers promptly, causing them to take their business elsewhere. This, of course, can lead to a drop in revenue that hinders growth.
When you have to devote time to rescheduling appointments or interacting with unhappy customers, you’re cutting into time that could be spent elsewhere. If you’re not careful, these sudden challenges can snowball into bigger problems that stall your business completely. In other words, car accidents can cause bankruptcy if you’re not careful.
Investing in Commercial Auto Insurance Coverage
While a personal auto insurance policy keeps you covered when you’re running errands or commuting to work, it may not offer much help when you’re on the road for business purposes. You’ll need a commercial auto policy instead to make sure you’re safe.
Commercial plans are more comprehensive. They’ll cover damage and bodily injuries. And they’ll cover vehicles used by employees, plus equipment that sustains damage. You don’t want to be jolted by unexpected medical bills from a crash, and you certainly don’t want to dip into business funds to pay them.
With higher liability limits in commercial auto policies, you can feel more confident that you’ll make it through an accident.
Considering Disability Coverage
Some crashes can result in chronic pain that leaves you or another employee unable to work. If you have disability insurance, you can weather the storm more easily knowing that you’ll have money to cover bills when an income stream is not there.
With short-term disability, you’ll have coverage for a period that can last anywhere from a few months to a year in some cases. Long-term disability offers continued support for years or longer. Having these coverages in place offers peace of mind as you get back on your feet.
Focusing on Communication
In the aftermath of a crash, you may have had meetings get canceled with vendors or lenders. Even worse, payment deadlines may have slipped, too. And if you’re short on cash to cover a lease payment or purchase, you’ll need to work with these third-party entities to get back on track.
Plan on communicating your situation clearly so you can work out a repayment term. You don’t want vendors to think you’re neglecting your duties. Instead, new payment terms can help you stay on track without gouging into your budget. At the same time, you’ll help maintain a positive relationship that lets you continue doing business.
Capturing Thorough Records
What happens if you were not the driver at fault for the accident? You could receive compensation that helps you cover medical expenses and other bills. To make the most effective claim, you’ll need to track all medical costs and lost wages. Take pictures of your vehicle and gather all replacement cost invoices.
When you have a pile of paperwork to outline your financial burden, you’ll help insurers determine damages. You can even collect canceled contracts to show that you’ve missed out on business opportunities due to the other driver’s negligence.
Keep Your Business Safe
A crash can be a disruptive force to your business. But when you’re proactive about seeking insurance coverage and talking with your vendors, you can help ensure that the worst doesn’t happen. Document everything, and look into the possibility of disability coverage for top employees.
You’ll thank yourself later when an unexpected event happens, and you’ll get your business back on track sooner.
