Types of Insurance Policies for Small Businesses
“I only have a small business, so I don’t need insurance.” Have you said this yourself? The truth is, that statement is completely wrong. Too many small businesses seem to have taken this approach, or are not insured enough. The size of your business does not determine whether or not you need insurance, although it does determine how much insurance you need. There are several types of insurance that any business requires to remain protected against any unfortunate events that might occur. Here is a list of the most common, and the most important.
General Liability Insurance
Let’s say that someone comes to your business and trips on a frayed carpet, or slips on a wet floor. You may be held liable for things like medical bills, lost wages, and pain and suffering. You certainly do not want to spend that out of your pocket. Nor do you want to pay for your legal costs, which can become incredibly substantial over time. With general liability insurance, you are protected from those costs if there is an accident. This coverage can also protect you against claims of slander or libel against your business.
Commercial Automobile Insurance
If you run a small business, you may not want to buy a separate vehicle. You might use your own to do business tasks, and never even think about insurance. However, if you are using your personal vehicle, there may be times when you are not actually covered by your personal insurance. It’s important to check with your insurance provider to see what you are covered for. The same goes for any employees you might have. Make sure that you have coverage, otherwise you will find yourself taking financial losses if there is an accident that causes damage, injuries, or worse.
Professional Liability Insurance
Getting injured on your property is just one way that you may be held liable. However, there are other ways that you may be accused of causing a loss to another person or entity. If you perform a service or provide advice to someone, and that somehow leads to them suffering a loss, they could sue you. For example, if you have a carpet cleaning business, and are contracted to clean the carpets of a banquet hall. If you did not properly dry the cleaned area, then they could bring action against you if they had to cancel an event. If you have carpet cleaning insurance for your business, then you will be able to cover those losses without paying out of your pocket.
Commercial Property Insurance
For many businesses, the property on which they operate is integral to what they do. You need to make sure that the property is properly protected, along with all of your equipment and inventory that is inside. This coverage will also protect things such as signage and fencing that are located on the exterior but are still at risk of being damaged. If you have the right coverage, it will compensate you for repairs or rebuilding, and limit your downtime so you can get back to business quickly.
It’s important to remember that even if you work out of your home, you may still need commercial property insurance of some kind. Your equipment, such as electronics and furniture, and your inventory if it is stored at your home, may not be covered under your homeowner’s policy. Check with your provider to make sure so that you don’t end up without any coverage.
Business Interruption Insurance
Speaking of getting back to business quickly, another coverage that could prove to be vitally important is business interruption insurance. Recent summers have seen a spate of wildfires in certain parts of the United States, and many businesses were affected. If you have business interruption insurance, then even if you have to shut down your business for certain incidents and hazards, you can still get compensation for lost wages, payroll, and other expenses. This will allow you to keep your business ready to go for when it is time to open up again, and prevents you from going under.
Just about everything is in digital form nowadays. That means that you are vulnerable to data breaches and hackers. If you are a victim, cyber insurance will help you cover the costs of letting your customers, employees, and patients know what happend. It will also provide compensation for hiring public relations professionals for yourself and credit monitoring services for the victims of the breach.
As you can see, there are several types of insurance that you need to make sure that your small business is protected. Never assume that just because your business is small that you don’t need protection. Take stock of your business to see where you might have risks, and make sure that you have protection for all of them.