October 10th, 2016
If you’re starting a new business, it is absolutely imperative that you invest in commercial insurance coverage. For one, commercial insurance is required by law in the U.S. if you have staff. Two, commercial insurance protects your business in times of trouble. And three, commercial insurance is just good business. Don’t lose out because you thought you were above the fray − no one is invincible.
How Will it Protect Me?
There are seven types of commercial insurance and are as follows:
General Liability Insurance: All small businesses require a liability insurance policy. Liability insurance covers you in the event that a product you provided to a client caused them bodily harm or their property serious damage. 43 percent of small business owners have been hit with the threat of a lawsuit by an employee and/or client. On average when a lawsuit does make it to court, a small business earning $1 million a year will spend $20,000 in litigation fees. Can your company afford to not get insurance?
Professional Liability Insurance: Commonly referred to as Errors & Omissions Insurance, professional liability insurance provides coverage in the event that a client sues your business for professional services rendered that caused them bodily harm or property damage. General liability insurance does NOT offer this type of coverage.
Property Insurance: If you own the warehouse or structure in which your business is housed, including the equipment and inventory, this policy will cover the property in the case of theft, vandalism, fire, smoke damage and natural disasters.
Commercial Auto Insurance: Should your small business own and operate a fleet of vehicles, (must number at least 10 to make a fleet) use a vehicle to operate business services or deliver product, you will need commercial auto insurance. This insurance type offers bodily injury and property damage liability if you or an employee should suffer an accident during business hours when operating a company-owned vehicle.
Business Owner’s Policy (BOP): This insurance policy is essential coverage for the small business owner. This package includes both property and liability protection as well as legal protection if you should be sued for poor business practices by an employee or client.
Worker’s Compensation: This coverage type is an absolute must have. Required by law, worker’s compensation offers insurance coverage to your employees if they are injured performing a work-related task during working hours. To reap these benefits, an employee must sign an agreement that gives up the right to sue the employer for an injury sustained in a work-related incident.
Data Breach: This comes as a surprise to some small business owners, but small businesses are big targets for the cybercriminal. If your small business files confidential information about staff and clients electronically, a data breach policy will cover the loss.
But it doesn’t just end with the above seven commercial insurance types. It has been recommended that small business owners invest in health insurance, renters insurance and life insurance so as to make sure their family is protected should a catastrophe strike.
This may initially read as too “doom and gloom,” but these policies are put in place to protect you. To find a commercial insurance package that fits your business, click here.