Five Crucial Commercial Insurance Pitfalls Dental Entrepreneurs Must Steer Clear Of
Tim McNeely CFP, CIMA
Don’t let a poor exit strategy hurt your financial future. I help dentists achieve high-value exits that build lasting wealth. Host: The Dental Wealth Nation Show | #1 Bestselling Author.
By the author of the #1 best-selling book, “Dental Wealth Nation ”
Key Insights:
As a dental entrepreneur driven by ambition and the pursuit of true wealth, you understand that commercial insurance is not just a checkbox but a cornerstone for your business's financial health.
The absence of proper insurance could force you to cover hefty legal claims from your personal finances, jeopardizing not just your business but your path to true wealth. Moreover, depending on your jurisdiction, you might be legally obligated to have specific kinds of commercial insurance.
However, even the most driven entrepreneurs can fall into the trap of common insurance mistakes. Here's a guide tailored for you, to ensure you're not inadvertently putting your hard-earned wealth at risk.
Mistake #1: Inadequate Management Liability Insurance
Management liability insurance is typically comprised of Directors and Officers (D&O) insurance and Employment Practices Liability Insurance (EPLI). These policies may vary slightly among providers, but fundamentally:
Having these policies is a cornerstone in the architecture of true wealth. However, even if you have these policies, pitfalls exist. For instance, does your business have shared limits between D&O and EPLI? Shared limits can quickly deplete your coverage, especially when legal costs are included. The remedy is to maintain separate limits for each.
Mistake #2: Ignoring Cybersecurity Insurance
The digital transformation, accelerated by the pandemic, has made cybersecurity insurance imperative. Cyber threats are escalating, and your dental practice is not immune.
If you store patient data or handle electronic transactions, cybersecurity insurance should be an integral part of your insurance portfolio. This insurance won't prevent cyber-attacks but will significantly mitigate the financial damage, helping you maintain your path to true wealth.
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Mistake #3: Overlooking Social Engineering Fraud Coverage
Social engineering fraud is a relatively new but rapidly growing threat. Criminals use detailed research to deceive your executives into releasing funds or sensitive information.
Traditional crime or cyber policies usually don't cover this type of fraud. Being aware and having specific coverage for social engineering fraud is crucial for safeguarding your assets and continuing your journey towards true wealth.
Mistake #4: Insufficient Liability Umbrella Coverage
Having the right level of umbrella coverage is essential, especially in high-risk industries. Your general liability policy is your first line of defense, but an umbrella policy is what stands between you and catastrophic financial loss.
Mistake #5: Neglecting Hired and Non-Owned Auto Coverage
If your team uses personal vehicles for business errands, this is a must-have. Without it, any accident liability exceeding an employee's personal auto policy limits could fall on your business, posing a severe risk to your financial stability and true wealth.
Time to Reevaluate Your Risk Profile
These are just a few of the common mistakes we often see. Consulting with an insurance expert who understands your industry can help you tailor your coverage, allowing you to focus on what you do best: building a thriving dental practice and true wealth.
Next Step: Don't leave your true wealth to chance. Consult a highly recommended commercial insurance expert who understands the nuances of the dental industry. Invest the time to help them understand your business in-depth; it's one of the most effective risk management strategies you can employ.
Unlock Your Path to True Wealth: Secure your financial future by grabbing a free copy of my #1 best-selling book, “Dental Wealth Nation,” today. Get your free book here .