As a result of fire damage or other property damage, the business activities can be discontinued or disturbed for a long time, in which case the business revenue of the cooperative is reduced or depleted. Despite the loss of income, the cooperative must pay all fixed costs like salaries, rents, and interests for debts.
These costs can be covered, and the outcome of the economic activity can be assured by underwriting a loss-of profit insurance. These can be fire insurances, machinery insurances, and business interruption insurances. A “business insurance” offers an extensive loss-of-profit cover. Its coverage can also be enlarged with personal business interruption coverage, providing cover for the company in case of an accident or critical personnel’s death.
According to the Finnish Tort Liability Act, the employer’s responsibility covers in principle all damages caused by an error or a deficiency of an employee working for the cooperative. With a third-party liability insurance, the cooperative can transfer a part of its liability to an insurer. This insurance covers the cooperative’s responsibility for personal injury or property damage caused during its operation to own or third-party workers.
A products liability insurance allows preparing for personal injury or damage to property caused by defective or erroneous products. Under the Finnish Product Liability Act, the responsibility concerning any damage caused by a product is a so-called “strict liability”, under which the liability is not dependent on negligence. There is product liability as soon as the product is not as secure as reasonably should have been presumed.
A legal protection insurance compensates, according to its terms, for the legal expenses and costs of litigation in case of a damage event related to the economical activity mentioned in the policy.
The damage and personal risks of a cooperative are considered “under control” if its insurance needs are carefully identified, an insurance plan is drawn up, the risks are taken care of with a sufficient cover and the insurance needs are under continuous review.