Running a business, any business, can be rewarding experience. However, it can also be a very demanding one as well. Along with the everyday responsibilities that are part and parcel with business ownership, there are also many unforeseen financial pitfalls that can befall a business at any moment. With all the risks and perils that may arise during the regular scope of conducting day to day affairs, a business owner would be wise to plan for the unexpected.

How does a business owner plan for an unforeseen event? Much like how anyone else would, through the purchase and use of insurance. Insurance has a wide array of business uses. So many in fact that it would be difficult to enumerate them all in this article, however, here are three major insurance consideration that every small business owner should think about when coming up with their financial plan.

I. Public liability insurance is very important. It covers a very particular kind of risk, the risk posed by a customer becoming injured on the premises of your business. This type of insurance will pay the injured party the amount that they are owed. Public liability insurance does even more however. It will pay a reimbursement for any legal expenses that may arise due to a customer injuring themselves on the premises of a business. This is especially important when the high cost of court fees are calculated into the equation, there are certain legal fees that must be paid, even if the court does not find in favor of the plaintiff.

II. Key employee insurance is a type of insurance that allows a small business to continue operating if a very important employee is either killed or injured in such a manner that they would no longer be able to perform their job. While this kind of insurance is somewhat morbid, it is essential when planning your business’s financial well-being. No one wants to see a business go under because of the loss of a central employee. Key Employee Insurance ensures that if that critical employee is lost however, then the business will have the money to keep going until a replacement for that individual is found.

III. A life insurance funded buy-sell agreement is also an important consideration. This type of business insurance mechanism is unique to partnerships. Again, it is morbid, but important to address. Each partner in a business holds a life insurance policy on the other. In the event that one of them passes away, the other then has enough money to buy out the remaining share of the partnership.