Natural disasters are occurrences that happen within the Earth’s structure, as a result of shifting tectonic plates, where volcanoes that occur at sea cause tsunamis to reach the shore. They are unpredictable and precautions cannot be taken to prepare sufficiently for them.
Unlike natural disasters, businesses can take precautions to prevent disaster from occurring, disaster that could take away from the profit that the make if they do not take precautions. These include indemnity insurance. This protects from malpractice, errors and omissions, or if an employee is in the transition period between health plans.
The cover called indemnity insurance protects all members of the business when they make error in judgment. As natural disasters can happen suddenly and out out the blue, so can judgment errors in a business. For example, the company may hire an employee, based on evidence that made them think that you were a suitable candidate for them. They discover, after the employees first two weeks, that they had made a mistake. They can let the person go and will be empowered to deal with any action that the employee takes against them.
Another example would be choosing the wrong business location. If, after working at the location for a small period of time, the business find that there are too many other businesses in the area that are selling the same product, and as a result the businesses stock won’t sell, then the company can move to a more favourable location and the move will be covered.
To prevent the disaster of loss of profit over the mistake of buying stock that refuses to sell, even after advertising and promoting the product, the business profit of this stock is covered.
On a similar level, a company can take out a loan that serves to extend their business. After taking out the loan, the economy takes a turn for the worse and, as a result the business suffers. The company is covered by this insurance plan in the even that this expansion leads to a loss. The plan will also cover the loan repayment.
On a different note, if the business signs a contract with a supplier that proves not to be reliable, then the company can claim for any damages incurred by this mistake. If an Internet service provider turns out have a slow connection that slows down your employees and the rate at which you can receive emails and download new information that relates to your business, then you can claim for damages that result from this mistake.