You’ve planned and re-planned, and the only thing you need to do before you open your company’s doors for the first time is buy insurance. There are dozens of small business insurance types, but you won’t need every kind. The coverage you need depends what your industry is, how you plan to do business, and several other factors. Keep reading to find out which coverage will best meet your needs.
Workers’ Compensation Insurance
Regardless of the industry you work in, you will likely need workers’ compensation insurance, especially if you hire employees. Workers’ compensation covers an employee’s take-home pay and medical expenses during recovery if he or she was hurt at work. Carrying this insurance according to your state law is extremely important. If you are caught without this coverage or if an employee sues you and you don’t have it, you could face thousands of dollars in fines or even criminal penalties.
General Liability Insurance
General liability is one of the most important kinds of coverage and is necessary no matter what type of business you run. Liability insurance protect you from being held financially responsible for damaged property or injuries that you, your employees, or your products and services cause to customers.
Professional Liability Insurance
If you run a business that provides services or offers advice to clients, professional liability insurance is essential. Financial planners, web developers, and even therapists can benefit from this type of insurance, because it protects them in case a client takes their advice, doesn’t receive the desired result, and decides to sue in court. Also known as errors and omissions insurance, it is helpful for recouping losses related to errors or negligence on your part as well.
Commercial Auto Insurance
Do you run a business that uses vehicles? Whether you have employees who operate a delivery service or you own vehicles for a contracting company, commercial auto insurance is a necessity. The policy protects you, your drivers, and your vehicles in the event of an accident, and is likely required by law in your state. Even if you use your personal vehicle to make business deliveries, you should consider a commercial policy. Your personal coverage likely doesn’t carry over to business-related use.
Commercial Property Insurance
All businesses need to protect their property with commercial property insurance. This type of coverage is available for all types of properties and covers everything from your retail space or office space to your company inventory, machinery, or other equipment. Brick-and-mortar establishments must have protection in place in case of theft, vandalism, fire, or other weather-related damage. Keep in mind that not all policies cover flooding, so you may need a separate policy for it. Additionally, property insurance doesn’t recoup any losses related to a closed business, so consider business interruption insurance as well.
Business Owner’s Policy
There is a sort of “one-stop shop” policy for people who own a small business and do most of the work themselves. The business owner’s policy, also known as BOP coverage, provides a combination of property and liability insurance in a single affordable package. It protects your business from damages related to customer injuries, property damage, and several other common problems small business owners may face.
Many factors need to be considered as you’re deciding on the right insurance policies to meet your needs. Think about the size of your company, the types of services you provide, the worth of your property, and other such details to help you learn which policies you need and which you can skip. Of course, remember to meet all the legal requirements, too. If you’re feeling overwhelmed, don’t worry. Insurance Guys can teach you how to cover your business.