If your insurance policy omits important elements of business protection, a lifetime of hard work can be lost in a few minutes. Sound insurance management for your business is fully as important as good financing, marketing, personnel management or any other key aspect of operations. Like all these other business issues, appropriate insurance for your business doesn’t just happen.

A good insurance plan guards against the unexpected. Some business risks are obvious: fire, theft and liability, for example. But your checklist for business protection should not be limited to the obvious. If you use special tools or equipment in your business, you may need special insurance covering them. If you need to close down your business for a period of time, you may also need business interruption insurance. Business interruption is perceived by many entrepreneurs as an unlikely event, but a natural disaster can cause tremendous damage to a business and its surrounding economy. Be sensitive to the impacts of a catastrophic event on the potential of your business to remain viable.

Bring a professional into the picture early. Analyze your needs. You don’t want to spend money on needless insurance or insurance for situations that are highly unlikely. Insurance is a fixed expense. Make wise choices before adding an additional expense to the business. Insurance is a complex and detailed subject. Seek out a reputable and qualified broker agent or consultant to explain insurance options. A qualified professional will recommend coverage options and help you avoid financial loss. Insurance is a protection. Evaluate what kind of protection and what level of insurance coverage is needed for your business.

Before purchasing insurance, consider all the possible ways of holding down the costs. Maybe it’s not reasonable to cover all perils. Cover the most risky and largest peril first, then work down your list of priorities. Don’t get needless coverage, but don’t try to save money by under-insuring or by not covering risks that could cause significant loss. If the probability is small the premium will be also. Use a deductible as high as you feel your cash flow will allow, given the need to use insurance in the event of an unexpected occurrence.

Many package policies are suitable for small businesses that they are designed to services, and usually it is less expensive to add riders than it is to get a separate policy for some risk not covered in the package. This generally means you should buy all of your coverage from a single agency or broker. If you do opt to purchase more than one policy, avoid duplications of coverage. Make sure the same risk is not covered under two different policies.

If you have questions about fixed expenses, risk and purchasing insurance for your business, call the SCORE® Association (Service Corps of Retired Executives). SCORE® is a nonprofit organization dedicated to helping America’s entrepreneurs. More than 12,000 volunteer, business counselors donate their time to provide free and confidential business counseling to entrepreneurs. For a referral to the SCORE® chapter nearest you, call 1 (800) 634-0245.