The poll by insurance company Safeco Corp. found that more than half (55%) said they do not have business income insurance while 63% of respondents confessed to being unfamiliar with the coverage, according to a news release.
Many entrepreneurs would shoot too low when they guesstimate how much coverage they might need, according to the poll. Nearly half (45%) estimated it would take them less than three months to recover to their current level of operations if their business was totally destroyed – half the time that insurance experts say is common. Six out of 10 say they don’t have the information they need to determine their business income insurance requirements.
Actually, small-business owners typically take four to six months to rebuild their property and resume operations and another six months to a year to return to previous income levels if their property is destroyed and their company is shut down, Safeco said. Yet in Safeco’s survey, only 19% of all small-business owners said they thought it would take six months or more to recover to their current level of operations if their workplace was totally destroyed.
To help close the knowledge gap, Safeco has introduced a business income insurance education section to its Web site and a new online calculator that allows small-business owners to better estimate their business income insurance needs.
After logging into www.safeco.com/businessincome , users respond to four questions about their net income, operating expenses, payroll plans, and expenses so they can calculate their estimated business income insurance needs. As an insurance provider, Safeco primarily caters to the small-business market.