Small Business Insurance

Insurance for Small Business

Starting a business is no small feat. It takes a lot of sacrifice and confidence to venture into the business world. And no matter if your business is starting up or you’re content with keeping it small, it needs to be protected by small business insurance.

Small business insurance policies can help cover you and your company from various issues you may encounter when operating. Without it, the business owners' finances and assets will be at risk. Insurance Navy will help small 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?

Small business insurance protects your company by providing financial assistance to help cover damages and lawsuits your company may face following an incident.

Some instances of commercial insurance for small businesses include on-site accidents, business errors, and natural disasters. Business insurance can also be personalized to fit your company’s specific needs. Various types of insurance coverage are offered with small business insurance.

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Types of Business Insurance

No matter what kind of company you run, you must protect it with a business insurance policy. A number of types of coverage make up a business policy.

Insurance companies typically offer a business owner policy, or BOP, encompassing coverage like professional liability and commercial property insurance. However, owners should understand what those policies cover before purchasing a conveniently bundled business liability policy from your insurer.

Outlined below are some types of business liability policies owners need to consider to make sure their company is protected no matter what life throws at them.

General Liability Business Insurance

Every small business needs a general liability insurance policy. Running any company comes with several liability concerns. General liability insurance protects an owner’s 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

Suppose you are facing a claim regarding anything mentioned above. In that case, general liability can help owners with expenses associated with the 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 medical payment coverage is essential to any business liability insurance policy.

Or suppose a customer claims your employee damaged property while doing construction in their home. Your general liability insurance will cover both of these. Legal expenses can also be included with a general liability policy 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 Business Insurance

Commercial property insurance coverage helps to protect the building your business operates out of. It also covers any business property surrounding the area and its contents. Some items protected under commercial property policy include fencing, furniture, and equipment.

This policy covers your building from hazards like storm damage and burst pipes. Commercial property policies will help rebuild, repair, or replace the damaged property, equipment, and structures.

It pays out 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 necessary if you operate your business from 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. You need a commercial auto policy if you regularly utilize any vehicle, including cars, trucks, or vans. It will save you from paying for damage or injuries you cause on the job.

One vehicle accident can be enough to result in severe financial losses for owners if they are on the line for damages and expenses.

Commercial auto policies includes the following forms of coverage:

Liability insurance

Liability car insurance policies cover any bodily injuries and property damage caused in an accident you are at fault for, including medical payments. It will never cover any injuries or damage to your property or vehicles. Check your state’s requirements for this type of liability coverage for your commercial vehicles.

Collision insurance coverage

Collision insurance policies pay 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

Auto insurance is mandatory in nearly every state, but some drivers still drive without it. If you are 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 called business income insurance, helps cover lost income and other necessary operating expenses like employees' wages. In contrast, your business is forced to close temporarily or must undergo a relocation due to a tragedy.

Business interruption coverage works with your property policy. It 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 severe loss of assets and fall behind on loans, tax payments, and wages.

Workers' Compensation Insurance

If you own any business, you need workers compensation. These policies are required for companies to carry in several states and offer you and your employees valuable protection for a work-related injury.

Workers' compensation policies will help cover medical bills and lost wages for employee injuries or if they contract an illness while on the job. If an employee loses their life 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, it 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 severe financial damage to your company. Check your state’s requirements and ask your insurer for this type of coverage.

Additional Insurance For Your Small Business

There are a wide variety of ways to expand your business insurance policy to ensure that every aspect of your company is adequately covered. Some industries operating in various states may need additional coverage from their insurer. You must recognize and be proactive about gaps in your business owner’s policy.

Below are some additional types of policy add-ons your small business can benefit from carrying.

Cyber Liability Insurance

Cyber insurance, sometimes called data breach insurance, protects your business if 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 electronically stores sensitive account information like credit card numbers, checking account numbers, social security numbers, and contact information.

Suppose you rely on technology and the internet to conduct your business. In that case, you should consider adding cyber insurance to your companies policy. Such security and privacy protection will help your customers feel more comfortable doing business with you.

Crime Insurance

Commercial crime insurance can pick up where commercial property insurance leaves off. This policy covers crime-related events that can affect your business.

Some common incidents it provides coverage for include:

  • Employee dishonesty or theft acts
  • Burglary and robberies of your inventory
  • Computer fraud
  • Theft of money and securities
  • Forgery

Suppose you fear any of these happening to your business. In that case, you may want to add crime coverage to your business policy if it’s available from your insurer. It would also be wise to review your commercial property coverage to decide if you need to add on crime coverage.

Employment Practices Liability Insurance

Employment practices liability insurance (EPLI) policies protect you and your business against third-party claims if your employees sue you for discrimination, sexual harassment, slander, libel, and wrongful termination.

This policy tends to support your business regardless of whether the lawsuit is legitimate. You never want to ignore such claims, but other policies will not cover you. With EPLI, you will receive assistance with your legal defense if you are sued to battle such cases. This policy 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 regarding day-to-day operations.

Errors and omissions insurance is typically used by attorneys, consultants, accountants, and other professional service providers because 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 incorrectly, leading to them in financial trouble. An Errors and Omissions policy can help with any lawsuits and defense costs your client brings.

Excess and Surplus Lines Insurance

High-risk firms that conventional insurers will not cover require specialty insurance policies, which excess and surplus insurance companies supply. Non-admitted insurance is a type of market that covers excluded or uninsurable risks.

An Excess and surplus policy is 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 insurer is another option.

Liquor Liability Insurance

This type of policy only applies to businesses that handle liquor. Liquor liability coverage protects firms that make, sell, or serve alcohol. This can include businesses like restaurants, taverns, and caterers. It helps cover your company if an intoxicated person causes bodily injuries or property damage as a result of the alcoholic beverage you have served them.

Liquor liability policies will help cover legal costs, settlements, repair bills, and medical expenses. This policy will only assist you if you are in the business of serving and selling alcohol.

Inland Marine Insurance

Inland marine insurance covers your property and inventory when it is in transit. This policy typically covers products traveling both over waters and on land. If you regularly transport items for your business, like equipment or products, you should consider an inland marine policy.

Your property insurance policy may exclude such valuables. Inland marine insurance covers goods such as computers and artwork.

How Much Does Business Insurance Cost?

It is hard to give an exact answer to how much small business insurance will cost your company. Policies are personalized, meaning the price you are quoted will significantly differ from the price another company is quoted.

Insurance companies have a whole process for determining rates. Factors such as your industry, where your business is located, and the number of employees on your payroll will all impact your premiums.

Despite this, it may still be helpful to establish a baseline. A Business Owners Policy, or BOP, costs about $2,200 annually. That comes out to be about $183 per month for coverage.

Suppose you strictly want only general liability, for example. That will be a bit cheaper, around $1,700 annually, depending on your company. Understanding how your policy is priced out is best so you can budget properly.

Do Small Businesses need a Business Insurance Policy?

Yes, businesses, especially small businesses, must carry business insurance coverage. Many states even have requirements for businesses mandating that they carry specific types of coverage to operate legally.

Running a company can be rewarding, but the path is riddled with many uncertainties. You can never predict when accidents will happen; owners have to settle for 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 owner’s financial ruin. Protect your company and employees by finding an adequate business policy.

Some types of business policies we provide:

Contact us today about any of the above policies!

Customize Your Small Business Insurance Policy

Every industry, even every business, has unique needs. Insurance is beneficial as your business owner’s policy, or BOP can be personalized to fit your company with the perfect policy limits.

It is highly recommended that owners begin with general liability insurance and then, from there, add a separate policy required by your state and necessary for your business.

For example, if you are a catering business and regularly use vans to service customers, ensure you have a commercial auto policy. If you have even one employee, you need workers' compensation insurance. Coverages like liquor liability and cyber insurance can be included in a package as you see fit.

Owners need to analyze their business and detect weak spots. These areas can be protected with the right insurance package.

Get a Small Business Insurance Quote Today

Do you need affordable business insurance products? We can help! Contact an agent today to get a free small business insurance quote and get your certificate of insurance instantly. We can understand the business insurance solutions you need by sharing personal information and details about your business.

You can get a quote at one of our many locations or online via our website and mobile app. You can also start your quote over the phone. Our licensed agents are available 24/7 to help. Getting business insurance today will help your company run smoothly tomorrow.

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