Do you have the correct types and amounts of insurance coverage for your business? Most people understand that they need to purchase coverage for their personal vehicles and the homes they live in, yet many business owners don’t consider that coverage for their business is just as important. No matter the size of your business, you need to consider purchasing commercial insurance coverage. A basic commercial policy is the very least amount of protection any business needs, with additional coverages being required depending on factors such as what your business does and if you have employees.
Just about every business in existence should consider, at the very least, carrying basic insurance coverage. Your primary business coverage will consist of a basic liability policy and a property policy. Often times, you can get these two coverages combined in what is called a business owners policy. Depending on the amount of property your business owns, you may need additional property coverage. For example, if you have a business building, then you will need a policy that specifically covers this structure. You will also need to make sure your property policy provides coverage for your business computers, equipment, furnishings, etc. Liability coverage is also something you will need. A basic liability policy should cover basic liability issues, such as if a visitor gets injured on your business premises. There may also be specialized liability insurance policies to consider, depending on what your business does and the exposure it faces.
Specialized Liability Coverage
Your business may need liability insurance coverage that goes beyond the basic coverage. For example, if your company owns or operates vehicles, you will need a commercial auto policy. This type of coverage provides protection for vehicles used for business purposes, something that a traditional auto policy does not offer. If you have employees, you most likely will need to have a workers compensation insurance policy. Each state has their own requirements, but typically you will need this coverage if you employee a certain number of people. Also known as workers comp, this coverage guarantees employees have access to timely medical care if they are injured while performing their job duties. If your company provides professional services, in which an error or omission on the part of your company may result in monetary damages to the client, then you should consider errors and omissions insurance. Companies that have employees going into the customer’s home should consider getting a fidelity bond, which is also called an employee dishonesty bond and provides coverage in the case of employee theft. There are several other specialized insurance coverages that may be something your business should consider. Consult with a licensed business insurance agent to explore your coverage options.
Carry The Right Policy Limits
Having business insurance is one thing – having the right coverage limits is another. An insurance policy does you no good if the policy limits (the amount it will pay out) are below the amount your company could be liable for. Check with a licensed insurance agent, as well as your accountant, to see what your business policy limits should be. Having the right combination of insurance types and policy limits helps ensure that your company is properly protected against potential liability exposure.
While many business owners may consider business insurance a luxury, you don’t want to find yourself in a situation where you don’t have the right type, or amount, of business insurance. Spend a little now so that your company is not faced with a situation that could potentially result in financial ruin. Beat the nagging fear that this could happen and get insured!