Like many other small business owners, you may have most of your personal capital tied up within your business and view your personal and business wealth as one large pool. While understandable, this mindset can unexpectedly impact your overall wealth in the event of personal property damage or an accident.
Consider that something as small as a candle, left lit and forgotten too close to a wall or a cabinet in your home, can cost upwards of $350,000 in fire damages. To make matters worse, if you don’t have sufficient insurance coverage for your home, you may be left paying for part of those repairs out-of-pocket.
In situations such as this, small business owners often find themselves tapping company assets to cover out-of-pocket costs. However, this can prove costly in its own way, as it can deplete your business’ working capital, in turn raising costs, reducing margins and lowering the overall value of your small business.
So what steps should small business owners take to manage their total wealth? Visit ThinkAdvisor to learn more about how the right homeowners and umbrella policies can help protect you and your small business for years to come.
Fran O’Brien is Division President, North America Personal Risk Services, Chubb.