From the time you set up a business, it becomes exposed to various types of risks that can bring its operations to a grinding halt if not mitigated. This is where business insurance comes into play. Businesses and entrepreneurs use business insurance to safeguard against natural calamities, drop in sales, and unforeseen crisis. Fortunately, there is a variety of types of insurance that a business can rely on to protect from unforeseen crisis. Below we highlight some of these types of insurance;
General Liability Insurance (GLI)
General liability insurance covers the company’s legal fees and medical expenses. It covers claims from bodily injuries and other accidents coming from normal business operations. This insurance policy covers property damage to another person’s belonging, bodily injuries, defamation, and personal injury.
Having your legal costs covered is an essential part of staying afloat. As a business owner, this policy gets the worry off your chest and gives you space to concentrate on other vital issues.
Commercial Property Insurance
The commercial property insurance policy covers a business’ owned or rented equipment and buildings. It covers all equipment used in the business’ daily operations. Note, however, that this policy does not cover loss from floods and earthquakes. You may need a separate policy to cover these natural calamities.
Business Income Insurance
A business income insurance policy can cover you from loss of income due to property damage. This policy helps to replace your lost income. As a business owner, you can rely on this policy to keep paying your recurrent expenses like payroll, utility bills, and rent. This policy is also called business interruption insurance.
Professional Liability Insurance
This insurance policy helps cover lawsuit claims from mistakes in the services you offer. The policy is also called errors and omissions (E&O) insurance.
Your business needs workers’ compensation insurance to cover workers from accidents. In the U.S, this insurance is often state-mandated. Workers’ compensation policy covers your employees from financial loss due to missed wages. It also covers medical expenses from accidents that occur in the line of duty.
In some cases, this policy may cover businesses from lawsuits for workplace conditions alleged to cause harm. This insurance policy is especially important to contractors. Before signing a contract, many clients always want to know if the contractor has covered this area.
For instance, American Insuring Group offers cost-effective worker’s compensation insurance that allows you to get the best price on quality insurance to protect your employees and your business.
Cyber Insurance policy protects a business from cyber-attacks, data loss, and malware. These are real business threats, especially in a digital business world. If your business is involved in any form of online business, you need cyber-insurance. The policy you purchase should cover credit card processing and accepting digital payments. It should also cover the storage of confidential information.
This is an essential policy for companies that have employees’ welfare at heart. An unemployment insurance policy is essential in a tight labor market. The supplemental coverage offered by the unemployment policy may help you attract the right employees.
To increase your business flexibility, you need to be ready for business interruption with an interruption insurance policy. This policy can cover a commercial property or even supply coverage for a home-based business.
This policy covers income loss due to the inability to open and operate a business for some time. The business interruption policy does not cover quarantines or viruses, and travel bans.
Commercial Auto Insurance
This policy covers you and your employees when driving company-owned vehicles for business purposes. The policy covers claims from bodily injury and property damage from accidents caused by your business. Commercial Auto Insurance covers third-party claims in an accident you cause with a business-owned vehicle. This is not covered in a personal car insurance policy.
Umbrella insurance covers your business from things that your standard policy does not cover. These include damage expenses, medical bills, and legal fees. This insurance policy adds an extra layer of protection to your business regardless of the sector you operate in.
Data Breach Insurance
Data breach insurance covers a business from a data breach if personally identifiable information gets lost or stolen. This policy can easily be confused with cyber insurance. This policy covers costs to notify affected individuals, offer identity theft monitoring services, and create a public relations campaign.
Life Insurance / Key Person
This policy covers employees or business owners who are unable to work or have become disabled. The policy is meant to ensure business continuity and pays out to a key person.
Many businesses are launched in people’s homes by professionals working from their homes. However, the homeowner’s policies do not cover these businesses, and if you are running such a business, you may need an additional cover for your home-based business.
Regardless of the business you are running, having business insurance is very important, and it can give startups a good foundation and sustain their business. Having the right insurance helps a business avoid significant financial loss due to a lawsuit or catastrophic event.