Small Business Insurance - Quick and Affordable Quotes
Starting a business is no small feat. It takes a lot of sacrifice and confidence to venture out into the business world. And no matter if your business is just starting up or you’re content with keeping it small, it needs to be protected by business insurance.
Small business insurance policies can help cover you and your company from a variety of issues you may encounter when operating. Without it, the business owners finances and business assets will be at risk. This guide will help business owners figure out where to get started with small business insurance and explore the different types of insurance coverages they should purchase.
What is Small Business Insurance?
Business insurance is a type of coverage that protects your company by providing financial assistance to help cover damages and/or lawsuits your company may end up facing following an incident.
Some instances of commercial insurance coverage include on-site accidents, business errors, and natural disasters. Business insurance can also be personalized to fit the specific needs of your company. Various different types of insurance coverage are offered with small business insurance.
Types of Small Business Insurance
No matter what kind of company you run, you need to make sure it is protected with small business insurance. There are a number of types of coverage that make up a business insurance policy.
Insurance companies typically offer a business owners policy, or BOP, that encompasses insurance coverage like professional liability and commercial property insurance. But owners should make sure they understand exactly what those insurances cover before purchasing a conveniently bundled business liability insurance policy from your insurer.
Outlined below are some types of business liability insurance owners need to be considering to make sure their company is protected no matter what life throws at them.
General Liability Business Insurance
Pretty much every small business needs general liability insurance. Running any type of company comes with a number of liability concerns. General liability insurance protects an owners business against claims others make towards their business that can arise during operation.
General Liability typically offers owners coverage for the following:
- Bodily injury
- Property damage
- Medical payments
- Advertising injuries
- Reputational harm, such as libel and defamation
- Damage to rentals
If you are facing an insurance claim regarding anything mentioned above, general liability can help owners with expenses associated with the insurance claim.
For example, if a customer slips and falls on your store’s premises, general liability will help with their medical costs. Medical costs can add up quickly so having medical payments coverage is a very important aspect of any business liability insurance policy.
Or suppose a customer claims your employee damaged property while doing construction in their home. Both of these will be covered by your general liability insurance. Legal costs can also be included with general liability if your business is sued following an incident.
General Liability coverage is pretty invaluable and a must-have for any small business. You never know what kind of instances can arise and how much damage they threaten to do to your company.
Commercial Property Insurance
Commercial property insurance coverage helps to protect the building your business operates out of. It also protects any commercial property surrounding the area and its contents. Some items protected under commercial property insurance include fencing, furniture, and equipment.
This insurance covers your building from hazards like storm damage and burst pipes. Commercial property insurance policies will help either rebuild, repair, or replace the damaged property, equipment, and structures.
It pays out one of two ways: replacement cost or actual cash value.
Replacement cost coverage will pay for the cost to fix or replace your business’s property and equipment as new without factoring in any depreciation.
Actual cash value reimburses your company for the damaged property or equipment based on its depreciated value. This coverage is a must if you operate your business out of a commercial property.
Commercial Auto Insurance for Small Business
Commercial auto insurance is crucial if your business relies on traveling from one place to another to generate income. If you regularly utilize any type of vehicle, including cars, trucks, or vans, you need a commercial auto policy. It will save you from having to pay for damage or injuries you cause on the job.
One vehicle accident can be enough to result in serious financial losses for owners if they are on the line for damages and expenses.
Commercial auto insurance includes the following forms of coverage:
Liability insurance policies cover any bodily injuries and property damage that you cause in an accident you are found to be at fault for, including medical payments. It will never cover any of your injuries or damage to your property or vehicles. Check your states requirements for this type of liability coverage for your commercial vehicles.
Collision insurance coverage
Collision insurance policies pays for damage to your vehicle following an accident.
Comprehensive insurance coverage
Comprehensive insurance policies cover damage your vehicle sustains in a non-collision-related incident, like theft or extreme weather.
Uninsured and underinsured motorist insurance coverage
Despite auto insurance being mandated in nearly every state, some still choose to drive without it. If you end up in an accident with such a driver, uninsured and underinsured motorist coverage will help pay for your expenses.
Business Interruption Insurance
Business interruption insurance, also commonly referred to as business income insurance helps cover lost income and other necessary operating expenses like employee’s wages while your business is forced to temporarily close or must undergo a relocation due to a tragedy.
Business interruption coverage works with your property policy and covers business owners in the event of a fire, vandalism, and extreme weather.
Some policy exclusions from your insurer include being forced to close due to the outbreak of viruses or diseases and flood or earthquake damage.
This type of coverage is vital if you operate your business out of a physical location like a retail storefront or office. Without it, business owners could suffer some serious loss in assets and fall behind on payments like loans, tax payments, and wages.
Workers' Compensation Insurance
If you own any kind of business, you need workers' compensation. Not only are these policies required for businesses to carry in several states, but it also offers you and your employees valuable protection.
Workers' compensation policies will help cover medical costs and lost wages if an employee is injured or contracts an illness while on the job. If your employee was killed on the job, workers comp could also help with funeral expenses. Part of the coverage may also apply to rehabilitation costs and physical therapy your recovering employee needs.
When you need to purchase this coverage can vary by state but, generally, the moment you hire your first employee, you should have workers' compensation insurance. Failure to provide such coverage can result in serious financial damage to your company. Check your states requirements and your insurance company for this type of coverage.
Additional Insurance For Your Small Business
There’s a number of ways to expand your business insurance policy to assure that every aspect of your company is properly covered. Some industries operating in various states may need certain liability coverage from their insurer. It is important that you recognize and be proactive about gaps in your business owners insurance coverage.
Outlined below are some additional types of insurance your small business can benefit from carrying.
Cyber Liability Insurance
Cyber insurance, also sometimes referred to as data breach insurance, protects your business in the event that you are the victim of an electronic threat. This can be useful following a data breach, cyberattack, or identity theft.
It is a wise purchase for any business that stores sensitive account information like credit card numbers, checking account numbers, social security numbers, and contact information electronically.
If you just rely on technology and the internet to conduct your business, you should consider adding cyber insurance to the policy your insurance company offers. Assuring such security and privacy protection will help your customers feel more comfortable doing business with you.
Commercial crime insurance can pick up where commercial property insurance leaves off. This insurance covers crime-related events that can affect your business.
Some common incidents it provides coverage for includes:
- Employee dishonesty or theft acts
- Burglary and robberies of your inventory
- Computer fraud
- Theft of money and securities
If you fear any of these happening to your business, you may want to look into adding crime insurance coverage to your business policy if it’s available from your insurance company. It would also be wise to review your commercial property coverage to decide if you need to add on crime insurance.
Employment Practices Liability Insurance
Employment practices liability insurance (EPLI) policies protects you and your business against specific claims and if you are sued by your employees for discrimination, sexual harassment, slander, libel, and wrongful termination.
This insurance tends to support your business regardless of if the lawsuit is legitimate or not. You never want to ignore such claims, but other insurance policies will not cover you. With EPLI, you will receive assistance with your legal defense if you are sued to battle such cases. This insurance can also help with protecting your employees.
Errors And Omissions Insurance
Errors and omissions (E&O) policies, also known as professional liability insurance, protect your business against claims of negligence or misconduct in regard to day-to-day operations.
Errors and omissions insurance is typically used by attorneys, consultants, accountants, and other professional services providers due to the fact that their profession is advising people. Financial or indirect loss can come as a result of their work.
For example, you are an accountant and file your client’s paperwork wrong, leading to them ending up in financial trouble. Errors and Omissions insurance can help with any lawsuits and defense costs your client brings about.
Excess and Surplus Lines Insurance
High-risk firms that conventional insurers will not cover require specialty insurance policies, which is supplied by excess and surplus insurance companies. Non-admitted insurance is a type of market that covers excluded or uninsurable risks.
Excess and surplus insurance are required for firms with unique or extreme threats since the accepted market believes they to be too hazardous to insure. A policy from a qualified excess and surplus insurance company is another option.
Liquor Liability Insurance
This type of insurance only applies to businesses that handle liquor. Liquor liability coverage protects businesses that make, sell, or serve alcohol. This can include businesses like restaurants, taverns, and caterers. It helps cover your company in the event that an intoxicated person causes bodily injuries or property damage as a result of the alcoholic beverage you have served them.
Liquor liability insurance policies will help cover legal costs, settlements, repair bills, and medical expenses. This insurance will only assist you if you are in the business of serving and/or selling alcohol.
Inland Marine Insurance
Inland marine insurance covers your property and inventory when it is in transit. This insurance typically covers products that are traveling both over waters and on land. If you are regularly transporting items for your business, like equipment or products, then you should consider inland marine insurance.
Your property insurance policy may exclude such valuables. Inland marine insurance covers goods such as computers and artwork.
Small Business Insurance Costs
It is hard to give an exact answer to how much small business insurance will cost your company. Insurance of any kind is personalized, meaning what you are quoted will be greatly different from what another company is quoted.
Insurance companies have a whole process for determining rates. Factors such as the industry you are in, where your business is located, and the number of employees on your payroll will all impact your insurance premiums.
Despite this, it may still be helpful to establish a baseline. On average, a Business Owners Policy, or BOP, costs about $2,200 annually. That comes about to be about $183 per month for coverage.
If you strictly want only general liability, for example, then that will be a bit cheaper, around $1,700 annually, depending on your company. It is best to have an understanding of how insurance is priced out so you can budget properly.
Do You Need Small Business Insurance Coverage?
Yes, every business, especially small businesses, needs to carry business insurance coverage. Many states even have requirements for businesses mandating they carry specific types of coverage in order to operate legally.
Running a company can be very rewarding, but the path is riddled with so many uncertainties. You can never predict when accidents will happen; owners have to settle for simply being prepared for them.
Purchasing business insurance is the best way to go about that. Ending up in an accident in your commercial vehicle or having a customer fall in your store can lead to an owners financial ruin. Protect your company and employees by finding an adequate business insurance policy.
Customize Your Small Business Insurance Policy
Every industry, even every business, has unique needs. Insurance is incredibly helpful as your business owners policy, or BOP, can be customized to fit your company perfectly.
It is highly recommended owners begin with general liability insurance and then from there, adding what is both required by your state and also necessary for your business.
For example, if you are a catering business and regularly use vans to service customers, make sure you have commercial auto insurance. If you have even one employee, you most certainly need workers' compensation insurance. Coverages like liquor liability and cyber insurance can be included as you see fit.
Owners need to analyze their business and detect weak spots. These areas can be protected with the right insurance coverage.
Get a Small Business Insurance Quote Today
Looking for small business insurance? We can help! Contact an insurance agent today to get a free small business insurance quote. By sharing some personal information and details about your business, we can get an idea of the coverage you need.
You can get a quote either at one of our many locations or online via our website and mobile app. You can also start your quote over the phone our agents are available 24/7 to help. Getting business insurance today will help your company run smoothly tomorrow.