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Disclaimer: Informational statements regarding insurance coverage are for general description purposes only. These statements do not amend, modify or supplement any insurance policy. This website does not make any representations that coverage does or does not exist for any particular claim or loss, or type of claim or loss, under any policy. Whether coverage exists or does not exist for any particular claim or loss under any policy depends on the facts and circumstances involved in the claim or loss and all applicable policy wording.
Whether your business is a massive corporation or a teeny-tiny LLC, business insurance is a must-have item.
In fact, second only to coming up with an awesome business name and logo, business insurance is the most important thing you should put on your checklist when you first set up shop.
What is business insurance - and why do you need it? In this article, we'll tell you everything you need to know so that you can shop for policies with confidence.
What is the Purpose of Business Insurance?
Business insurance can help protect you from losses that might occur during the course of business. The term refers broadly to a class of coverage that is meant for businesses rather than individuals. It can be used to cover property damage, to guard against lawsuits, or even cover expenses related to contract disputes. A business insurance policy is often referred to as a "commercial line" or policy.
What Types of Business Insurance Are There?
There are several types of business insurance that you might consider purchasing for your company.
General Liability Policies
Commercial general liability insurance, sometimes called business liability insurance, is meant to protect your small business from claims of property damage or bodily injury.
A mistake that many business owners make when shopping for insurance coverage is assuming they can skip over commercial general liability insurance or settle for a cut-rate policy. "I'm an honest, hard-working person - nobody will ever sue me." Don’t tell yourself this lie!
Accidents happen - so no matter how diligent or responsible you are, it's a good idea to get this kind of insurance for your business (honestly, we'd recommend it even for Mother Teresa herself - you never know what might happen!).
General liability insurance can cover way more than you might think. In addition to paying for things like customer bodily injury, property damage that occurs while you are working at a customer's home might be covered, too. That's essential if you have a business in construction or something along those lines.
It can also cover legal costs to defend your company in a lawsuit or for cases of advertising injuries (like copyright infringement) or reputational harm.
Other Liability Insurance Policies
There are additional lines of coverage for your business that you can buy. One of these is product liability insurance.
Product liability insurance is essential if your business manufactures products to sell. If you are named in a lawsuit regarding some sort of damage caused by your product, you'll want to have product liability insurance in place to protect you.
Professional liability insurance is something else you'll want to consider. This is for individuals who offer professional services such as consulting work. If a client thinks that the advice you offered caused a financial loss, they might sue you. Professional liability insurance can cover claims such as negligence, inaccurate advice, or misrepresentation.
There are many other kinds of business liability coverage you can get, including commercial umbrella insurance or directors and officers insurance. If you aren't sure what kind of business liability insurance to get, it always pays to chat with an agent from a reputable insurance company.
Employee Insurance Policies
If you have employees, your state will likely require you to carry workers' compensation insurance. This will provide your employees with the benefits they need as they recover from work-related injuries or illnesses. It can also provide a benefit to the family of a worker who died in a workplace accident.
There are numerous factors that can impact the cost of worker's compensation insurance, such as how many employees you have on payroll (and how much they are paid), your claims history, and the inherent risk of the job (high-risk occupations will often come with higher premiums).
NYS disability insurance is another example of an employee insurance policy you'll want to have in place. The state offers benefits on its own, but as a business, you may also want to consider adding voluntary benefits like short- and long-term disability coverage to your employees as well.
There are several types of property policies that business owners can pursue. One of the most common is commercial property insurance. This kind of policy can cover all of your equipment, inventory, signage, and furniture in the event of a destructive event like a storm, theft, or fire.
In most cases, it doesn't cover unique events like earthquakes and floods. For these, you'll need a separate policy. Most business owners won't invest in this extra coverage unless their businesses are located in high-risk areas (such as California, in the case of earthquakes, or on the coast, for floods).
If you already have homeowner's insurance, know that a commercial property insurance policy is very similar - but it's for your business. Depending on whether you have a large or small business and what your insurance needs actually are, a commercial property insurance policy can be customized as needed.
Business Auto Insurance
If your company doesn't have any vehicles on the road, you can probably skip over a commercial auto policy. However, any vehicles that are used for your business need to be fully insured. In many states, this is a legal requirement to have them on the road.
At the very least, you'll want to purchase adequate liability limits in the event of an accident.
You'll want to touch base with an insurance agency to find out what kind of auto insurance coverage you need, as there are lots of individual circumstances that can make getting a policy more confusing.
There is inherent risk in any commercial setting. Our risk management team partners with you to identify activities that drive claim frequency, explore opportunities that create a safer work environment, and implement an action plan to contain losses. We identify training needs and provide on-site assistance to address risk mitigation opportunities while promoting a safe work environment for your employees.
Creating and supporting a culture of health and safety is a critical component for your business and may even boost your bottom line. Businesses that make workplace safety a priority see fewer at-risk behaviors and accidents, lower absenteeism, and higher productivity.
Our team of highly trained experts includes individuals with CIC (Certified Insurance Counselors), CPCU (Chartered Property and Casualty Underwriters), CRM (Certified Risk Manager), & CISR (Certified Insurance Service Representative) designations. While insurance is the most important form of risk transfer, our risk management services – and those of our companies – are the added value that come with doing business with us.
Home-Based Business Coverage
Do you run a small business out of your home? It might not make sense for you to pay top dollar for regular business insurance. At the same time, your homeowner's policy might not cover claims related to your business if you're working from home.
Because Of that, it's a good idea to get separate lines of coverage for equipment and inventory that your home-based business might have.
Business Interruption Insurance
Business interruption insurance is meant to cover companies that require a physical location to do business (such as restaurants or retail stores). It could cover your lost income if there is a disruption to the regular course of business.
Usually, this has to be related to some sort of physical damage or property damage. In most cases, you wouldn't be covered if you were out of commission if, say, you couldn't work due to a global pandemic like COVID-19.
If you have rental properties (even just a second vacation home that you rent out during the winter), you should get landlord's insurance. There are generally two types of coverage you can get, including liability protection and property insurance.
Commercial Crime Insurance
Though not necessarily required for everyone, getting commercial crime insurance is a good idea if you find yourself particularly at risk. This kind of policy could cover things such as:
Fraudulent electronic funds transfers
Receipt of counterfeit money
Theft, damage, or destruction of money or property on your premises or while in transit
Fraudulent manipulation of your computer system (like hackers transferring your funds to an outside account)
Don't Go it On Your Own!
If you're looking for insurance for your business, whether it's professional liability insurance or workers compensation coverage, you shouldn't set out on your own. Instead, contact Northern Insuring to help you live your life protected – we can provide you with the options available for a small business owner.
In addition to offering you with options insurance products (and bundles!) that you need to stay protected and save money, we can also conduct a thorough risk management assessment. We can pinpoint ways that your business can help prevent accidents and other losses so that your likelihood of having to submit a claim is much lower.
Of course, we will work with you every step of the way to make sure your questions are answered and that every aspect of business insurance is clarified - we don't want to keep you in the dark.
Stay protected and go with Northern Insuring for all of your business insurance needs. We simplify the complicated... for insurance. Contact us today!