Most businesses need more than one type of insurance coverage. Spending some time considering what is needed and how the policies can be structured for your business is probably a good use of time and effort. Managing and growing a business is hard enough without having to worry about not being covered if unforeseen events occur.
Discuss your specific business risks and the types of insurance available with your insurance agent or broker. Your agency can recommend the exact types of insurance you should consider purchasing. Below are common types of insurance to consider.
Just about every business should have insurance to cover the loss or damage to property, inventory or equipment. Premiums vary according to the type of property, coverage limits and what you insure against. For electronic equipment (think of computers), be sure to investigate how your policy works in case of damage to the files (power outages or surges) as well as damage to actual equipment. Backing up files and storing them in a secure, off-premises location is advisable as well.
Business interruption insurance
Investigate insurance that would provide benefits if you were no longer able to conduct business in your usual fashion. These policies vary greatly in cost depending on what is covered. However, consider what would happen if you could not occupy your location in case of disaster.
This insurance can cover damages you pay as a result of your actions or negligence, or if someone is injured while at your business. Everyone has heard of the large damage awards being made when a customer slips and falls because the business did not melt the ice in front of the door.
Workers’ compensation insurance
This insurance provides coverage for medical and related costs for accidental injuries suffered by employees at your workplace. The amount of coverage required varies by state.
If you use a vehicle, even if it is your personal one, you may be required to have a commercial auto insurance policy. If you are a sole proprietor and use your car, be sure to discuss this with your auto insurance provider.
This coverage fills in the gaps of your other policies or provides additional coverage once the original policy limits are exceeded. This can be extremely valuable in case of large losses. Many companies offer these policies, it is possible to find that one of your professional organizations has a relationship with an issuer that will keep your cost low.
Do some research on the different types of insurance businesses typically need and be prepared to share the details of your business with your insurance professional.