If you’re a business owner, depending on the type of business and industry you’re in, you’ll need several types of business insurance. You may feel like it may be too expensive to purchase, but business insurance for self-employed and professional businesses is a must.
So many situations that are out of your control can befall your business and shut it down—possibly forever. Because insurance policies can be complex, it’s important to discuss your options with an insurance professional, and preferably to purchase your insurance from a single insurance company that is familiar with your industry and its associated risks.
The following are some types of business insurance you may need to purchase in order to protect yourself and your business.
General liability insurance
There are a number of scenarios where business liability insurance can come in handy:
- A customer falls on your property.
- You have a defective product that causes injury.
- A company car is involved in an accident that causes injury.
- Any other sort of accident involving your business during business hours.
Injuries can be very expensive due to doctors’ bills, pain and suffering, and other types of compensation. Without liability insurance, your business could go bankrupt paying for these expenses.
Professional liability insurance
Also known as errors and omissions insurance, this type of policy protects your business from failing to deliver professional services. This is different than a general liability insurance policy. Professionals such as attorneys, accountants, and insurance agents—anyone in a professional firm—should look into purchasing such a policy. This can protect you if you are ever involved in litigation.
Commercial auto insurance
Related to liability insurance, if you or an employee is involved in a car accident, with injuries, this could be devastating to your business’s bottom line. You can purchase insurance for cars that are both own and not owned by the company.
This sort of insurance is for employees who are injured while working. It provides wage replacement and medical benefits. When employees accept worker’s compensation, they forfeit their right to sue you, which can save you litigation costs.
This type of business insurance protects your business from permanently shutting its doors due to catastrophes such as natural disasters. If you have to close your doors, it would only be temporarily.
Business interruption insurance
Business interruption insurance helps your business have cash flow if your business suffered a catastrophic loss, a break-in, or are involved expensive litigation and you’re unable to be open for business. This covers lost profits as well. If your business sustained significant damage due to a flood, you could possibly set up shop in a temporary location.
Especially if you’re a new business, or if you’re a business that has gone through some upgrades, all your new shiny equipment can be an allure for thieves. Crime insurance helps to replace all your stolen equipment and helps to pay for repairs due to a break-in.
This policy protects your business’s building and the business’s personal property from any sort of damage: computers, office equipment, inventory, tools, etc.
Data breach insurance
If you store sensitive information, whether it’s from your clients or other business partners, you may want to look into this sort of insurance. With so many data hacking incidents, you want to protect your business from the losses that can occur from a data breach.
Life insurance can give peace of mind to your family if you suddenly pass. It can help with funeral expenses as well as other expenses which may incur due to handling your business after you’re gone.
For all the other types of insurance that you may have, not everything may be covered or you may have hit the limits of coverage. This policy would cover the rest. Especially in disastrous losses, umbrella insurance can be extremely helpful.
Business owner’s policy
This is a bundled option of business insurance, which can include liability insurance, crime insurance, property insurance, business interruption insurance, and automobile insurance. Bundling these policies is a more affordable option, and you can tailor what is included based on your business’s needs.
Business insurance policies are important for the health and longevity of your business. It’s worth the investment so you can protect your business from possible future calamity and misfortune.