How the Electric Marketplace is Changing Business Insurance

How the Electric Marketplace is Changing Business Insurance

Projections show that within the next few years up to ten percent of international retail business will be from internet transactions. Standard business insurance may cover some liability and property loss, but internet-based companies have risks and needs that differ from brick and mortar operations. E-commerce business insurance is designed to meet the unique coverage requirements of the electric marketplace.

Global Reach Needs World Wide Coverage

Doing business over the Web means erasing the boundaries of where a product or service can go. That translates to opportunity, but also to greater risk. E-commerce business insurance may be designed to cover losses due to a failure on the part of a dependent business such as distribution center, warehouse or transportation company.

Internet-Specific Risk

Liability coverage for web-based businesses looks quite different than for traditional on-the-ground businesses. An internet company has special needs regarding protection against loss of sensitive data, both the business and the clients. Computer theft is another big issue. Reports say losses of intellectual property from U.S. companies are in excess of 200 billion dollars a year. Another type of coverage is electronic publishing liability, which is concerned with the publication of protected materials on the internet.

Protecting Reputations

When a database is hacked or an outside party is responsible for an interruption in business, e-commerce business insurance may extend to cover expenses incurred when and if public relations services are required to stem damages to a companys reputation. The insurance industry is working every day to meet evolving needs such as this for e-commerce business owners.


photo credit: Sint Smeding cc
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