What Every Small Business Needs But Doesn’t Always Have: Crime Insurance

Are you a small business owner? If you are, understanding the complexities of the ins and outs of the business world can be daunting. So can understanding what sort of insurance you may need. Hopefully, you have business insurance and personal insurance that will protect you in case you're hit with a disaster or you're injured and unable to continue running your business. But have you considered crime insurance? If not, this is what you should know.

Crime insurance protects you against white-collar crime.

So-called "white-collar" crime often comes from inside a business itself and happens when you least expect it, usually because the person who commits the crime is someone that you trust implicitly—otherwise, they wouldn't have access to your funds or the ability to cover up what they've done. White-collar crime includes things like fraud, extortion, embezzlement, and computer-related crimes.

Forgery is often an aspect of a white-collar crime. How often has someone who works for you signed your name to some receipt or another business document after you've given the okay? Has it become commonplace for several people to sign your name if you're out of the office when something comes in? If so, you could be exposing yourself to significant risks of fraud and making it easy for someone to embezzle money from your company. 

How closely do you watch your books? Do you have a clear idea of exactly what money is coming in and going out of your business at all times? Have you turned that part of your operations over to someone else inside the business that you trust so that you can focus on other aspects integral to your success? Again, that may be normal and natural to do, but it does expose you to risk.

Crime insurance also protects you against petty thefts that could ruin your reputation.

If you run a business that does significant interactions with the public, such as a retail store or restaurant of some sort, your cashiers may take hundreds of credit cards and debit card transactions in a week. While you'd like to be able to trust every employee that you have, the reality is that some people aren't trustworthy in the first place. Other people simply get in a financially bad place and make desperate decisions that could end up costing them—and you—quite a bit. If an employee starts skimming a little extra off customer's credit transactions, they could go undetected for quite a while. Once discovered, your hard-earned reputation is going to be the one in tatters unless you're able to make restitution to everyone involved.

Crime insurance also protects you from blatant thefts.

Crime insurance also reimburses your business if your inventory goes missing or you're the target of a robbery. An inventory theft could eventually cost you hundreds or thousands of dollars by the time you realize it has happened. A robbery can put your entire business at risk if you're running a tight profit margin that can't absorb the loss.

For more information on crime insurance, talk to your insurance agent today.