Striking out on your own as an entrepreneur can be as nerve-wracking as it is exciting. One of the reasons for business owner stress is the possibility of catastrophic expenses due to unforeseen accidents, disasters and lawsuits. Fortunately, you can put your mind at ease with insurance for entrepreneurs.
Most new businesses need to operate on lean budgets. Consequently, finding the right level of coverage and the right deal is essential to avoid being saddled with overpriced premiums. Below is some information on why self employed coverage is important, what type of insurance you can buy and what insurance you may need.
Reasons To Buy Insurance For Entrepreneurs
Insurance isn’t just covering your business; it is covering your lifestyle. If your business experiences significant financial losses from insurable liabilities, chances are it will affect your income in the very least, if not other assets. A stable business, even if you are the sole employee, needs to have proper insurance. These are a few of the reasons why entrepreneurs should buy insurance:
- The Law: Many types of insurance are legally mandated. For example, workers’ compensation insurance is usually required if you have employees. Commercial auto insurance is required if you have a business vehicle.
- Possibility of a Lawsuit: The court system allows people to get compensated when they are wronged. Unfortunately, this means that businesses are always at risk of being sued over various legal liabilities. Insurance can help you be ready to manage the potential financial burden.
- Continuity: If you have some financial struggles, you don’t want your business to just stop. Insurance can help you to keep your company continuously operating even when unforeseen expenses arise.
- Credibility: When you take on a big client, you want to look professional. Having certificates of insurance ready to show is a component of this. When you can demonstrate your planning for unforeseen circumstances, others can see that you mean business.
- The Unknown Future: It would be nice to look into a crystal ball to see what obstacles may be ahead. Unfortunately, none of us are able to do so. Insurance is the tool business owners use to protect against any unexpected future obstacles.
Types of Insurance
Clearly, insurance is a good idea. However, you may not know what varieties of insurance for entrepreneurs are even available. These are a few of the most common types of insurance coverage for businesses:
- General Liability: This protects against losses from a variety of common liabilities such as injury, libel and lawsuits.
- Commercial Property: This policy protects your real estate assets and covers liability for anyone injured on the premises.
- Workers’ Compensation: This type of insurance helps to cover the medical expenses of injured employees. It is legally required to hire people in most places.
- Professional Liability: This form of insurance protects you against liability from error or malpractice in rendering services.
- Product Liability: This policy is for liability from injuries caused by product defects.
- Commercial Auto: If you own a business vehicle, you need to cover it like any other car. There are auto policies specifically for business use.
- Business Owner’s Policy: This umbrella insurance provides coverage for many of the above liabilities. It is a common choice for new businesses that need broad coverage at a reasonable price.
What Insurance Do You Need?
The insurance you need as an entrepreneur depends on your current operations. Most businesses should at least carry a general liability or business owner’s policy. Even operating a website can open you to liabilities such as copyright and libel lawsuits. If you are actively selling products or services, you should carry either product liability or professional liability insurance respectively.
Beyond that, it depends greatly on your business. However, in general, if you own and/or operate something that could cause harm to others, you should carry insurance. For example, commercial property insurance is essential for your business’s workspace.
Consult legal counsel to determine what insurance coverage you are legally required to have in the places your business operates. Additionally, consider speaking to an insurance expert to determine which insurance would be advisable for your current operations.
Start Coverage Today
Don’t leave your business or your lifestyle open to liability. Get the insurance you need today and enjoy peace of mind and a more certain future for your business.