What insurance is needed for my business?
Choosing the proper insurance and coverage amounts can be overwhelming. Let’s look at the typical business insurance needed by almost any business as well as some additional insight to other coverage available which may fit your business.
Understanding the language in an insurance policy is important. Work with a licensed insurance professional along the way to help you understand the specifics of your policies. It’s important to understand what’s not covered as much as what is. Don’t be afraid to question your agent regarding the specifics of any coverage presented.
Purchasing insurance, or risk management is generally a department of a big company, but even in a start up, the business owner has to assume that role. Your licensed insurance professional becomes your number one resource in determining the risk you and your business have and help you determine the coverage necessary to reduce that risk. In addition, your state department of insurance is a great resource. Pick up the phone or even jump in your car and get the necessary information.
Generally, most businesses will find 3 primary areas of risk which need to be addressed. The first is property insurance. Property insurance protects your business property and inventory against loss or damage by accident, theft, or another cause or by another party.
Often, your property insurance may be purchased in conjunction with your liability coverage. These combined policies are often sold as Business Owners Policies or B.O.P’s. The second is general liability insurance. Liability insurance protects the company against claims of injury either bodily or physically. This would protect you in the event of an accident at your business or in another location where you or your employees are conducting business.
As noted above, general liability protection is offered through a B.O.P. In some cases, a business may also need professional liability coverage. Discuss professional liability with your insurance professional. Medical Malpractice Insurance is an example of professional liability insurance.
Finally, if you have employees, workers compensation is required in most states. This insurance covers medical and loss wages to an employee injured conducting company business. It also protects the business from being sued by the employee.
Disability insurance is necessary in several states. Check with your licensed professional and the state department of insurance in your state.
Develop an insurance plan with you licensed insurance professional to assess the risk and develop a comprehensive insurance package that fits your specific needs. Remember, your insurance agent and the companies represented are tremendous resources available for you.