Managing Risks Associated with Entrepreneurship Ventures
It is every government’s goal to promote economic prosperity for its citizens and one of the key strategies to promote economic prosperity is through reduction of the unemployment rate. The Government of Zimbabwe has been working on reducing the unemployment rate by promoting Entrepreneurship through introduction of the Youth bank and Women’s Bank. The existence of the Ministry of Small and Medium Enterprises is also a confirmation of government’s efforts to help many enterprises grow.
Though the government and some non-governmental organisations are working towards promoting entrepreneurship through various initiatives, it is not an easy road for starters mainly because of the risk factors involved in new business ventures. For example, a catastrophic event could be enough to wipe out one’s balance sheet before it even has a chance to get off the ground. To be a successful entrepreneur there is need to manage the risks and challenges that come with it.
Fortunately, businesses have access to a wide range of insurance products to protect them against some of these risks. Below are some insurance covers that a business can have in place.
Property insurance.
This policy covers all tangible property against fire, and other perils such as lightning, storm, hail, water damage, explosions, storm, earthquakes, aircraft, and impact by animals and/ or vehicles.
Professional Indemnity
This covers a business against claims from mistakes or failure to perform. Professionals who require this cover include Doctors, Engineers, lawyers, Architects etc. The specific needs of each industry are addressed in a customized way.
Vehicle Insurance
Vehicles that are used for business will have more time on the roads hence the greater the risks of getting involved in accidents. It is therefore imperative for a business to have comprehensive insurance for its vehicles.
Products liability
For businesses that manufacture products for consumption by the general public, it is vital for them to take up product liability to protect themselves from lawsuits arising from death or injury caused by their products.
Business interruption insurance.
A catastrophic event such as a fire or a storm may result in interruption of business operations hence affecting incomes. The Business interruption policy is designed to compensate a business for its lost income during these events until business is reinstated.
By having the right insurance in place, a business can avoid major financial losses due to fortuitous events.
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