A small business owner must make many decisions in order to succeed. The first is to determine the type of insurance that they need to protect their products, employees, and property. Small business owners are required to have workers’ compensation, unemployment insurance and other insurance. Some states may also require additional insurance like disability insurance. Insurance isn’t a one-size-fits all solution. There are many options for small business insurance. The type of business insurance you choose can have a significant impact on your business, depending on the activities you engage in. For advice on choosing the right policies for your small business, read our 19 tips.
General liability insurance provides coverage for bodily injury and property damage resulting from incidents on your premises, from your products, or your operations. It also covers certain legal defense costs in the event that your company is sued. Reputational kel damage due to libel or slander can be covered. Commercial Property Insurance is the best option for business insurance. These policies protect buildings that you own or rent against fire, smoke and wind, storm, hurricane or tornado damage. This policy also covers your desk, equipment, computers, and files. Additional policies are available on a state-by-state basis to cover flood and earthquake damage.
Many states have a requirement for workers’ compensation insurance. The number of employees a company must cover will vary from one state to the next. If an employee is injured at work, the insurance will cover that cost. Your broker can help you determine if it is necessary to purchase it through a state-run program. Short-term or long-term disability insurance provides additional coverage for workers’ compensation that covers off-the-job illnesses and injuries. Your business must purchase disability insurance for employees if it is located in California or Hawaii.
Ask your agent if they have a policy for business owners that bundles commercial insurance coverages such as general liability or property insurance. A business owner’s plan is a type commercial insurance policy that bundles insurance policies that you would otherwise separate. Bundled policies can offer discounts on the total cost.
Each business owner should be protected in the event that an employment-related case arises. Employers can get Employment Practice Liability Insurance to protect themselves against certain employment-related legal disputes between their employees, former employees, and job applicants. This includes age, race and sex discrimination as well as sexual harassment, retaliation and failure to promote, and wrongful termination. With just a few keystrokes, credit card data, including names, addresses, phone numbers, driver’s license numbers and health records, can be easily lost. Cyber liability insurance protects your company from damages due to a breach of network security or privacy in which customer data, or corporate confidential information is stolen or exposed by hackers.
Employers must have unemployment insurance. This allows employees to claim unemployment benefits if they quit working for the company. Every state has its own state’s unemployment insurance coverage, often referred to by SUTA or SUI. Your tax payments are calculated during payroll. Professional liability insurance protects your business from customers who are unhappy if you offer a service. Personal liability is not covered by an insurance policy that covers homeowners who own a home business.
Your company vehicles are covered by commercial auto insurance. This coverage does not cover the driver and is only applicable to vehicles. For employees who use their personal vehicle for business purposes, you might consider adding non-owned auto coverage to your policy.