Making the right decision about your business insurance coverage can be a very challenging thing to do. After all knowing the right amount of coverage and the specific areas that you need to be concerned about can take quite a bit of research and there is certainly a lot riding on your decisions. However, here at Beaty insurance we want to empower you to be well-educated and well-informed about the different components of business insurance so that this important step is as easy as possible to take.
With that in mind let’s go over some of the major things you should know about business insurance.
Four Fundamental Types of Business Insurance
As we mentioned above, specific insurance needs vary from business to business. However, that said, there are four types of business insurance coverages that nearly all small businesses need and should consider getting. They are as follows:
Property Insurance – This one is really a must have for anyone serious about protecting their business. Property insurance for a business is similar to property insurance for a home or residence in that it protects the physical structure and belongings from loss due to covered disasters such as fire or theft for example.
Property insurance for a business may also cover additional operating expenses as well. Much depends on the specific type of policy that you get. This type of coverage is definitely one of the best places to start when you are looking for coverage for your business.
Liability Insurance – Liability insurance is another big must have for businesses. As anyone involved in the business world can attest, it is not uncommon for businesses and enterprises to be sued for various reasons. Liability insurance offers a form of protection when the business is sued.
Liability insurance will cover such things as settlements and attorney’s fees up to the amount of coverage of the policy. It also pays for medical expenses for people who have been injured on the business’s premises. Considering how costly lawsuits can be this is definitely a type of coverage you don’t want to ignore.
Business Auto Insurance – Many if not mosts businesses has some type of company car or use an automobile regularly in the course of their business. As the name implies business auto insurance provides additional auto coverage for these cars.
Workers Compensation Insurance – Worker’s compensation insurance is required in most states whenever a business has more than a set number of employees, typically 3-5 employees. This type of insurance provides compensation and covers medical bills for employees who are damaged in the course of business. It is important to note that this coverage kicks in regardless of who was at fault for the injury. Worker’s Comp also awards compensation to an employee’s family if the employee dies as a result of the injuries they sustained at work.
Additional Types of Business Coverages
Besides the big four that we discussed above, there are several other very useful types of business coverages that companies may want to consider. They include the following:
Errors and Omissions Insurance/Professional Liability – This type of insurance is especially useful for companies that, in the course of their business, provide advice or make recommendations, as well as companies who design things regularly or who represent the needs of others. Basically this type of insurance kicks in when someone claims that there was wrongdoing on the part of the company and sues as a result. The policy not only covers settlements up to the coverage amount, but it also covers legal costs associated with the case regardless of whether or not the company is found to have been in the wrong.
Employment Practices Liability Insurance – This coverage is designed to protect the company against being sued for violating an employee’s civil or other legal rights. Again it would provide a payment for the amount of the settlement, up to the policy’s coverage amount, in addition to covering the costs of the legal fees.
Directors and Officers Liability Insurance – This policy is actually designed to protect the head figures of a business or company who may themselves be sued for mismanagement or other improper conduct. It will cover the costs of the settlement and the legal expenses up to the coverage amount.
Key Employee Insurance – Many businesses rely very heavily on certain key employees. The business may suffer significant losses as a result of these key employees dying or becoming disabled. This type of insurance is designed to protect against that loss.
Umbrella Policies – Umbrella policies are designed to cover companies in the event of a very expensive loss that exceeds the coverage limit for that type of loss. For instance if there is an auto claim that is extremely expensive and exceeds the limits then the umbrella policy will kick in; however, it also covers the other types of policies that a business may have such as other liability coverages. Umbrella policies can be extremely useful to businesses precisely because they are designed to fill in any unforeseen gaps in regular coverage.
Making the right decision about your business insurance can seem like a very tough thing to do. However, the well-trained agents here at Beaty Insurance are always happy to help with advice and price quotes about these policies. We strive for excellence in customer service and insurance care so please let us know what we can do for you.