Small business 101 | Online risks? How e-commerce insurance can help
About to pivot to 100% online? Growing your business with Shopify, Amazon, eBay, Etsy or Wayfair? Using Salesforce to target your clients? Delivering products with UberEats or Instacart? Building brand awareness with Zoom calls? Using Buffer, Hootsuite or Sprout Social to grow your social relationships? Keeping connected with remote employees via Slack? Creating your brand content using Canva or WordPress? Engaging potential customers on TikTok and Instagram?
Whew! You’re likely not only a bit stretched thin, but you’re also likely a small business owner in Canada.
As a result, you are most likely looking to the future and how to gain more clients, customers and marketshare. Above all, you are looking to grow. And that’s great. And according to Canadian Business magazine, you are not alone…
“Despite all the turbulence in 2020, there’s actually good reason to believe Canadian small and medium-sized businesses (SMBs) are poised for a turnaround.
According to the most recent Salesforce Small and Medium Business Trends Report, for instance, more than a quarter of Canadian SMBs, or 26 percent, said they were optimistic about the future. This is even higher than the global average of 22 percent.
Canadian Business: How Canada’s Small Businesses Can Create Resilient Futures
Shifting to online is trending. However, online risks are different than bricks and mortar risks. Therefore, this is why you need dedicated e-commerce insurance to address the specific risks of your online sales.
Canadian small businesses with e-commerce stores trust our experts to align their business with coverage that’s built to address online retail risks.
In short, we know how to help you manage your online risks with insurance that will respond when things go wrong.
E-commerce 101 | What to know about selling online to Canadians and Americans
Are you already selling online? Or are you transitioning? During your shift to e-commerce, there are things you need to know about online retailing. We’ve brought together some current insights about online retailing coverage in Canada, the U.S. and around the world.
For example:
Q. If I sell to U.S. customers are Canadian e-commerce insurance policies enforceable?
A. Yes. In fact, your e-commerce policy can cover lawsuits filed in the US and Canada or just in Canada. In addition, a properly placed online retailer policy can include North American or worldwide territory clauses.
Q. I understand that $1 million in Commercial General liability (aka CGL) is the standard for pro merchants. Is $1M CGL available in Canada and the United States?
A. Yes. We place CGL coverage for CDN, US and global online e-commerce sales. If you have Canadian legal entity or are a Canadian citizen with a Canadian mailing address.
Q. Lawsuits happen. So what will happen if I get sued in the U.S.?
A. Coverage for defence costs and settlements or judgments against you can be covered. While it’s rare that a Canadian small business e-commerce retailer is sued in the US, our policies cover U.S. lawsuits.
Q. Can I get e-commerce insurance everywhere in Canada?
A. Yes, with the exception of Québec, ALIGNED Insurance has licensing in all Canadian provinces.
Q. I’m a sole-proprietor. How does e-commerce insurance work for me?
A. To clarify, your policy can be placed under your personal name or your legal entity as a sole-proprietor.
Insurance insights can make the difference between risk exposure and a safe and secure sale. This is why we are constantly adding to our insurance blog. Talk to an ALIGNED Insurance broker about your e-commerce coverage for your small business now.
Already online with your small business? Keep reading…
Q. I work from home. What happens if my house catches fire? In other words, would my home insurance cover my e-commerce inventory?
A. All business activities and/or inventory stored in a home should be formally reported to your personal home insurer. If you run a business out of your personal residence and haven’t disclosed this to your insurer, the insurance company has the ability to deny your claim fully in some cases.
In addition, evidence of separate commercial general liability and/or property insurance for your small business assets in your residence may be required.
Q. Is it legitimate if a Canadian business gets insurance from U.S.-based company and also uses a U.S. mailbox?
A. While it may be the case that some Canadian Amazon retailers are securing insurance outside of Canada, this is not recommended. Legitimate e-commerce insurance for a Canadian legal entity and/or sole-proprietor must and can only be purchased from a Canadian licensed insurance company. You can find out more info about this on the Insurance Bureau of Canada website.
In addition, e-commerce insurance must also be placed by a licensed insurance broker in the province where the client lives and/or the small business is incorporated.
Q. I sell a variety of products such as retail arbitrage, online arbitrage and wholesale – can I get e-commerce insurance?
A. Yes. Simply provide a breakdown of the annual revenue from each type, the products or product categories as well as the percentage split between your CDN, US and/or Global sales.
Q. What e-commerce insurance can I get for selling children’s toys online?
A. We need your specific responses to our Q&A and product testing documentation to secure e-commerce coverage options for children’s toys. This is because children’s toys are considered a high risk category and insurance premiums are higher for these types of products.
In short, if you need online business insurance, we can help
Whew! We understand that as a small business owner in Canada you are likely stretched thin. That’s why our insurance brokers will work hard to find you the best online insurance options for your small business.
