You can’t tell for sure what kind of challenges your small business is going to face in the future, that is why you should always come prepared. Working with professionals like the Columbus workers comp lawyers will give you the opportunity to receive the best advice on different legal aspects. While running a business is a constant challenge with its fair share of ups and downs, having the right insurance coverages will give you peace of mind and help you keep the venture afloat during the more trying times. It’s important to collaborate with companies that do their best to protect your interests, maximize benefits and assist you in each legal situation.
Here are the top six liability insurance policies that you should consider for your small business.
1. General Liability Insurance
If there’s one insurance policy that your small business absolutely needs to have, it’s general liability insurance. GLI is actually a package policy that includes two of the most important coverages for entrepreneurs – public liability insurance and product liability insurance.
Your general liability insurance will protect the business from third-party injury or property damage claims that were a result of some form of negligence on your part. If a customer slips and hurts himself in the company premises or one of your employees damages the client’s car while on the job, your GLI will take care of the medical bills and any other claims/expenses related to the incident.
2. Professional Liability Insurance
Professional liability is more often referred to as errors and omissions (E&O) insurance. The policy protects businesses against negligence claims stemming from the failure to perform, which eventually leads to a financial loss on the client’s part.
Your E&O insurance will help cover the claims and legal costs if a client sues you for not being able to deliver professional services to standards. This type of insurance is a must for contractors, accountants, doctors, architects, attorneys, engineers, and other professionals who are more vulnerable to malpractice and negligence lawsuits.
There is no such thing as one-size-fits-all professional liability insurance. Every industry is different and has specific needs. Even businesses like microblading service providers need insurance, which you can read more about here. Professional liability policies are usually customized to address concerns unique to the business.
3. Worker’s Compensation Insurance
Most states require employers to carry worker’s compensation insurance to ensure the protection of the workforce.
Any business that hires people must have worker’s compensation as part of its business insurance policy. Worker’s compensation insurance is a good way to protect your employees’ interests should they sustain work-related injuries or suffer from illnesses.
The insurance will pay for the medical care and lost wages of employees who got injured while on the job. It also covers death and disability benefits in the event that an employee dies or becomes disabled.
Workplace accidents happen all the time. As a business owner, you have to prepare for these eventualities for the sake of both your company and the people you work with.
4. Property insurance
You need to have commercial property insurance regardless of whether your business owns or leases its space. It’s one of those policies that any business owner should have from the very start.
Property insurance will cover the building, equipment, inventory, and furniture in the event of a disaster. It protects the business property and everything inside from covered loss. The coverage may even extend to structures outside the building like signages, fencing, and landscaping as long as the damage is caused by a covered peril.
Without property insurance, you might have a really hard time recovering from incidents like fire, storm, or burglary. The right policy can help you abate the long-term effects of loss and lessen your business’ downtime.
Like most things, however, property insurance also has limitations. The policies generally exclude losses from mass destruction events like floods and earthquakes. If your business is located in a disaster-prone area, you might want to purchase a separate policy to cover the following perils.
5. Commercial Auto Insurance
Any business that owns or utilizes other’s vehicles for operational purposes should carry commercial auto insurance. States usually require minimum coverage for any business with a vehicle, but it should be wise to opt for higher coverage than what is legally required.
Even if you only use your personal vehicle for transporting people, equipment, or inventory, merely relying on your personal auto coverage can put you at a disadvantage. In case of an accident, your personal auto insurance may not cover damages to your products or equipment, which puts your business interests at risk.
You have two commercial auto insurance options. First, you have traditional auto insurance which combines liability and property insurance coverages. This one is almost similar to your personal auto policy, but more adapted to business needs.
The second is a hired and non-owned auto policy which extends the coverage to vehicles that aren’t owned by the business. This is the better choice if your employees use rented or their personal vehicles for work-related functions.
6. Cyber Liability Insurance
Cyber-attacks and security breaches are becoming prevalent in this increasingly digital world we live in, and small businesses aren’t safe from these risks. Startups are actually attractive targets for hackers because their technologies and databases aren’t as secure or protected as those of larger corporations.
If general liability and property insurance policies protect you against disaster and a variety of physical risks, cyber liability insurance safeguards your business from digital threats.
While cyber policies are fairly young and yet to be standardized, they can protect your business from a spectrum of cyber threats including data breaches, hacks, and cyber extortion, among others. Any company that deals with or manages sensitive information like customers’ medical, financial, or credit card details, should have a cyber liability policy.
With these policies in place, your business will be able to weather lawsuits and catastrophic events with as little damage as possible. It takes a lot of time and hard work to grow a venture. Protect it as much as you can!