Business insurance helps companies protect their property and financial assets, while also minimizing their risk of losses that may occur during normal business operations. Business insurance can be purchased to cover nearly every aspect of a business, from equipment and inventory protection to workers compensation in case an employee is injured on the job. Learn more about business insurance, what business insurance typically covers, and why you should contact professional business consultants today.
Why You Need Business Insurance
Startups and small businesses are often on a tight budget. With minimal extra funds, it can be tempting to forego business insurance. However, this often is not a wise choice and can result in financial ruin if your business experiences any type of legal mishap.
For instance, if a customer slips and falls inside your restaurant, you could be looking at a $20,000+ personal injury lawsuit. The costs of insurance premiums are far lower than the potential cost of a legal battle. While you do not need to go out and buy every type of insurance available to you, it is a strategic move to compare your options and choose policies that will benefit your business.
What Business Insurance Covers
Business insurance is essential for companies of all sizes to reduce the potential financial loss that can occur due to an unexpected event. Business insurance may include the following:
- General Liability Insurance: General liability insurance protects businesses from third party claims of bodily injury, property damage, and medical costs. Policies may also cover the expenses associated with out-of-court settlements, litigation procedures, and judgments by the court system.
- Professional Liability and Malpractice Insurance: This type of professional liability insurance generally protects physicians and other licensed health professionals, such as dentists and nurses. Professional liability insurance may cover costs associated with wrongful practices resulting from medical expenses, bodily injury, and property damage.
- Product Liability Insurance: Product liability insurance covers the costs of a lawsuit, medical bills, and related costs if a product that you sell causes injury to a person or makes them ill. This type of business insurance is most useful to manufacturers, retailers, distributors, and restaurant owners.
- Property Insurance: Property insurance is designed to protect your assets in the event of a loss, such as a fire that destroyed your building, a burst water pipe that damaged valuable documents, or a major storm that tore down your outdoor sign. Property damage typically covers indoor and outdoor property, as well as the building itself.
- Commercial Vehicle Insurance: Commercial auto insurance provides physical damage coverage and liability coverage for any vehicles that are used by your business, including vans, cars, and commercial trucks.
- Workers Compensation: Workers compensation provides wage replacement, as well as medical benefits to employees who may become ill or injured during job operations.
- Cyber Crime Insurance: This type of insurance policy provides protection from crimes that are committed through a computer or other internet-enabled device. This may include data or security breaches which can result in substantial loss.
- Specialty Coverage: There are forms of coverage that may come in handy under specific circumstances. For example, a business may want specialty coverage if they plan to put on a one-day event, such as a concert or seminar.
How to Choose Business Insurance
Buying business insurance is one of the most crucial choices you can make for the future of your company. However, the many types of policies can be overwhelming for business owners who may not know what insurance types they need. When shopping for business insurance, you will want to ask a number of questions. First, find out if the provider you are considering specializes in business insurance. You want to ensure that the company you choose understands your business, how to assess your risks, and the best way to protect your company.
Once you know what provider you want to work with, begin researching your different coverage options. Ideally, you want to choose coverage that aligns with your business plan. Your policies should not only protect your business but also help your company grow in the right direction. Get several quotes from different companies and compare price, coverage details, and the overall value of each. While you do not want to simply go with the cheapest option, you do want to pick a policy that fits in your budget. Review your quotes and take the time to choose which policies are best for your business.
Remember that not all business insurance policies are the same. You will need to carefully check to see what each policy covers and what it does not cover. Specialized insurance coverage is typically more restricted in scope. This type of policy is often sought out when liability relates to a unique risk. A more comprehensive insurance policy will provide liability coverage for any type of occurrence that may happen during that period, such as property damage or personal injuries. Also take note of what is excluded on your policy. For example, damages that were intended or expected may be excluded.
Assistance with Business Insurance
Another major decision you will have to make when shopping for business insurance is whether to go through a broker or buy directly from the insurance company. While larger businesses generally have risk managers to help them choose the best insurance coverage for them, smaller businesses may not have access to this type of professional. That is when having experienced business consultants can come in extremely handy.
Professional business consultants will help you choose the right type of coverage for your business. They will also explain the various risks that different types of policies can help protect against. Whether this is your first time acquiring business insurance or you are already familiar with your policy options, a broker can help guide you through the process and address any questions or concerns you may have. For more information about acquiring business insurance or to receive assistance, contact the business insurance consultants at BBG Broker.