Get business insurance
Business insurance protects you from the unexpected costs of running a business. Accidents, natural disasters, and lawsuits can put you out of business if you’re not protected with the right insurance.
Select the type of business insurance you need
The protection you get by selecting a business structure, such as a limited liability company (LLC) or corporation, generally only protects your personal property from legal claims, and even that protection is limited. What Is Business Insurance? The Ultimate Guide
Business insurance can fill those gaps to ensure that both your personal and business assets are fully protected from unexpected catastrophes.
In some cases, you may be required by law to purchase a certain type of business insurance.
The federal government requires every business with employees to have workers’ compensation, unemployment, and disability insurance.
In some states, additional insurance is also required. Laws requiring insurance vary by state, so check your state’s website to find out the requirements for your business.
Six Common Types of Business Insurance
After purchasing the insurance required by law, you can find other insurance that covers any other business risks. As a general rule, you should have insurance against things you couldn’t afford on your own.
Check with insurance agents to find out what type of coverage is most reasonable for your business, and compare terms and prices to find the best deal for you. Here are six common types of business insurance to look for:
|type of insurance||for whom it is||what does|
|general liability insurance||any company||This coverage protects against financial loss as a result of bodily injury, property damage, medical expenses, libel, defamation, court costs, and settlement or trial bonds.|
|product liability insurance||Businesses that manufacture, wholesale, distribute, or retail products||This coverage protects against financial loss as a result of a defective product causing bodily injury or damage.|
|professional liability insurance||Companies that provide services to their customers||This coverage protects against financial loss as a result of malpractice, error, or negligence.|
|commercial property insurance||Companies with a significant amount of property and physical assets||This coverage protects your business against loss of and damage to company property due to a wide variety of events, including fire, smoke, wind and hail, civil disturbances, and vandalism.|
|home business insurance||Companies that are managed from the personal address of the owner||Coverage added to homeowner’s insurance can offer protection for business equipment and third-party liability coverage for a small amount.|
|Business Owner’s Policy||Most small business owners, but especially home-based businesses||The business owner’s policy is an insurance package that combines the most common coverage options into one package. It simplifies the process of buying insurance and can save you money.|
Four steps to buying commercial insurance
- Evaluate your risks. Think about what kinds of accidents, natural disasters, or lawsuits could hurt your business. For example, if your business is located in a commercial area that is at risk of seasonal events such as fire or hail storms, commercial property insurance will help protect you against loss.
- Look for a reputable and reputable agent. Commercial insurance agents can help you find the policies that meet your business needs. Since they receive commissions from insurance companies when they sell policies, it’s important to find a reputable agent who cares about both the client’s needs and your own.
- look well. Prices and benefits can vary considerably. You should compare the insurance rates, terms, and benefits offered by different agents.
- Reassess every year. As your business grows, so will your responsibilities. If you have purchased or replaced equipment or expanded your operations, you should contact your insurance agent to discuss the changes at your business and see if they affect your coverage.