Executive Chronicles | Startup Basics: What Kind of Business Insurance Coverage Is Right for Your Company? | There’s a good chance that your business is underinsured. Some estimates say that 75% of small businesses are underinsured.
It’s important to get insurance right for your small business when you begin. An unforeseen event could leave your business in financial distress just as you get it off the ground.
That could create a disaster. How can you make sure that you have adequate business insurance coverage? Read on to learn the different types of business insurance you should consider.
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General Liability Insurance
This is the insurance policy that most think of when considering business insurance coverage. A general business insurance policy doesn’t cover everything.
It covers slips and falls that happen on your premises. Some cover lawsuits from misleading advertising claims or injury claims from advertising.
This type of business insurance policy also covers damages to another person’s property caused by you or your employees.
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Errors and Omissions Insurance
Service providers need to consider errors and omissions insurance. This is also called E&O or professional liability insurance.
This covers instances where the service provider didn’t provide services according to the contract. For example, if you are a web designer and the client sues you because you didn’t deliver on time or as expected, you’re covered.
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Workers Compensation Insurance
Worker’s compensation insurance is required for all businesses with employees by most states. This covers your employees’ medical bills and lost income if they’re injured at work.
It’s essentially an agreement between your business and employees. You agree to cover their injuries, while they agree not to sue your business.
Private insurance companies offer this insurance, but rates and terms are set by each state.
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Property Insurance
Property insurance covers the property that the business owns in case of fires, theft, and property damage. This can be a building, manufacturing equipment, IT equipment, and inventory.
Many business owners opt for a business owners insurance policy. This rolls property insurance and general liability policies into one policy. This lets you save money on monthly premiums.
Learn more about the different types of business insurance and this policy option.
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Cyber Insurance
A recent survey found that 56% of small business owners aren’t concerned about a cyberattack. They should be because small businesses make up 43% of data breaches.
Cyber insurance protects your business if you suffer a data breach or malware attack. Some policies cover ransoms in a ransomware attack. Others cover public relations costs.
Check this and every insurance policy carefully to fully understand what’s covered by business insurance.
Get the Best Business Insurance Coverage
Business insurance coverage isn’t something to overlook and ignore as you start your business. Insuring your business is easy once you know what you need.
You limit your business risk and you can operate without the fear of a lawsuit or other complicated issues. You can focus on delivering the best service to your customers.
For more startup business tips, click on the Go Solo tab at the top of this page.
