There is insurance coverage for practically all possible risks facing a business. The cost of insurance and the covered amount will vary by the unique policies of different insurers. A business will do well to consult with its insurance agency or broker about the particular business risks and kinds of insurance available to it. Here we will go over several of the prominent typed of business insurance to consider to protect your company.
General Liability Insurance
General Liability Insurance covers the legal issues when a company is accused of accident, injury, or negligence. This insurance protects a business from having to pay when claims of physical injury, damaged property, medical expenses, or other costs of lawsuits arise. This includes any settlement bonds or needed judgments while the appeal procedure goes on.
Product Liability Insurance
Companies involved with manufacturing, wholesale, distribution, or retail for products can have liability for the safety of the products. With Product Liability Insurance, a company is protected against financial loss due to issues with defective products causing harm. The recommended amount of product liability insurance will depend on the kind of product sold by a manufacturing company. A t-shirt company will have less risk than a manufacturer of fireworks.
Professional Liability Insurance
For companies in the service industry, Professional Liability Insurance (also called errors of omission service) is a benefit for protecting a business from instances of malpractice, errors, and negligence in the performance of services to customers by employees. Some states require certain service industries to have professional liability insurance, such as physicians for hospitals.
Commercial Property Insurance
Commercial Property Insurance covers a business for damage of property related to events like natural disasters or vandalism, for fires, powerful storms, destruction of property by vandals, civil disobedience, etc. The definition of what is meant by “property” is fairly broad, including income lost, interruption of business, buildings, machinery, documents and money.
Insurance for property is available in two basic forms:
- All Risk Policies: these cover a very wide range of disasters. These are typically used to cover all risks faced by a small business.
- Peril-specific Policies: these cover damages from perils specifically listed in the policy, such as fire insurance, flood insurance, crime, etc. These specific policies are often used for industries where there is higher risk for a specific problem occurring. (Crime in bad neighborhood, fire in California, etc).
Consult with an insurance broker about the best course to take for your business when insuring for any perils or protecting your company from liabilities.
Home-owners insurance doesn’t typically cover losses at home-based businesses. Business owners who operate from home may have to invest in some more specific policies for additional types of business insurance beyond homeowners insurance in order to be fully covered.