TYPES OF INSURANCE

Prior to becoming self-employed, there are a number of factors that need to be considered and clarified, including social security, insurance coverage and retirement provisions. Being well-informed will help you implement the steps and measures required for your social and professional security.

In principle, insurances can be divided into three main categories: personal, property and asset insurances. It is difficult to make a general statement about coverage needs of new or potential entrepreneurs as these needs largely depends on the type of business and the individual risk situation. We recommend that you consult an insurance expert and request offers from various providers. Some general information concerning the different types of insurance is provided in the following.

In Switzerland, the following insurances pertain to the category of personal insurances:

Old Age and Survivors‘ Insurance (AHV) and disability insurance (IV)
Occupational pension plan (BVG)
Unemployment insurance (ALV)
Accident insurance (UVG)
Health insurance (KVG )
Income compensation ordinance (EO)
Maternity insurance (MSE)
Military insurance (MV)

Further information about personal insurances is available from this website under social insurances.

Property insurances provide protection from the financial consequences resulting from damage, destruction or loss of property caused by fire, water, glass, or theft (robbery or burglary). Most insurance companies offer insurance packages specifically tailored to the needs of small and medium-size enterprises (SME).

A buildings insurance covers damages caused to buildings and permanently installed objects. In the Canton of Zurich, as in most other cantons, the property fire risk insurance is compulsory. This insurance also includes damage caused by certain natural forces (e.g. flooding). In contrast, furnishings (chattels) and equipment (goods) are not covered. Coverage of these items needs a separate insurance (chattels).

Destroyed or damaged business chattels or goods due to fire, water, theft (robbery and burglary) or glass breakage can pose a threat to your existence as an entrepreneur. This insurance is similar to a private household insurance and also covers damages to property of third parties, rented objects, leased objects or objects taken into care.

Technical insurances can, for instance, be taken out for IT installations, technical installations (telephones), for machines or for their installation. The insurances cover the repair and replacement costs. These insurances are worthwhile supplements to property insurance (chattels) which does not always provide sufficient coverage and security in the technical field. .

Things can occasionally go wrong when transporting goods. A transport insurance protects from damages which goods can suffer during transport, e.g. through damage or loss.

Asset insurances primarily provide coverage of assets. The most important asset insurances are:

a) Third party liability insurance for motor vehicles

Third party liability insurance is compulsory for all motor vehicles (cars, motorbikes, commercial vehicles or agricultural vehicles) used on public roads. Insurance covers damages caused with the vehicle to third parties. The premium for the third party liability insurance for motor vehicles depends, inter alia, on age of the driver, his/her driving experience and the type of vehicle. The insurance also works according to a bonus-malus system, meaning that the premium is reduced (bonus) in the event of accident-free driving and increased (malus) following a damage claim.

b) Public / Professional liability

Anyone who inflicts harm on a third party, whether intentionally or due to carelessness, can be held liable. There are countless danger sources that can result from an entrepreneurial activity. Practically speaking, a distinction is made between three risk and danger areas:

facilities risks (e.g. construction defects)
operating risks (e.g. environmental damages)
product risks (e.g. damages caused by faulty products)

The insurance company examines the claims, pays justified demands of claimants and rejects inflated or even unjustified claims. There are different public and professional liability insurances depending on the business sector. Medical doctors, architects, engineers, lawyers, notaries, fiduciaries, chartered accountants as well as their employees should on all accounts take out a professional liability insurance so as to be protected in the event of injury to a person or damage to property as a consequence of their professional activity.

c) Interruption of business

Production losses resulting from an interruption of operations of a machine, of goods or when transporting goods as a consequence of an insured fire or water damage are not covered by the property insurance (chattels). An additional insurance (e.g. a machinery loss of profits insurance) needs to be taken out for this.

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