What Insurance Do You Need for a Small Business?

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Insurance is crucial for businesses of all sizes, but for small businesses who often don’t have access to large amounts of capital or resources, especially when they’re first starting out, insurance is a lifesaver. There are a lot of different types of insurance you can take out for your small business, but there are lots of factors to consider before you decide which policy to go for.

The perfect small business insurance package from biberk.com will vary from business to business, which is why it’s important to combine the right policies that provide suitable coverage for your business. We’re going to look at the types of insurance you can get for a small business before exploring what factors to consider when taking out an insurance policy for your business.

Types of Business Insurance

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Before you can decide which insurance is best for your small business, you need to understand exactly what each type of business insurance covers. Let’s look at the different types of business insurance that are available to business owners.

General Liability Insurance

General liability insurance covers your business for a range of different claims against your business, including bodily injury and property damage. It’s a vital part of any business insurance policy as it protects your business against any claims that occur during normal business operations. It’s impossible to predict accidents, but having this kind of coverage means that your business will have financial support in the event of an accident and potential legal case. This kind of insurance can be easily bundled with other types of coverage too, so that you can find the exact package for your business.

Professional Liability Insurance

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Professional liability insurance, which is also known as errors and omissions insurance, covers the services that businesses provide. Whether you’re a consultant or a massage parlor, if a client is unhappy with the services that you have provided, they may make a claim against your business. Having professional liability insurance means that your business has provisions in place to deal with any claims that may come in.

Business Owner’s Policy (BOP)

A Business Owner’s Policy combines a number of property and liability insurance policies into one convenient package. This is a great starting insurance package for those who are new to the business world, covering many elements of your business.

Automotive Insurance

Like personal automotive insurance, commercial automotive insurance protects any vehicles you have registered at your business. In the event of an accident, this kind of insurance can cover any repairs or rehabilitation costs for both parties.

Workers’ Compensation Insurance

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For companies that employ people, workers’ compensation insurance is a crucial policy to have in place. In many states, it’s also a legal requirement for businesses, so it’s important to look at the laws of your state or area. This insurance provides your staff with support should they fall ill or get injured at work.

Employers’ Liability Insurance

Employers’ liability insurance protects employers financially against claims from employees in their business. Should there be a claim from an employee, this kind of policy provides support to employers when navigating internal disputes.

Property Insurance

Whether you outrightly own your storefront, office or warehouse or rent it, you will need property insurance. Coverage for your business property protects your organization from a range of risks including:

  • Theft
  • Damage
  • Natural disasters or extreme weather conditions
  • Accidents

If any of the above situations were to occur, your insurance provider would be able to provide support with repairs, replacing assets and more.

Commercial Insurance

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Another package insurance policy similar to a Business Owner’s Policy, commercial insurance provides a range of liability insurance policies all in one. These packages can be tailored to your specific business needs and requirements, and are often easier to manage than taking out multiple individual policies. This protects your business from a range of different claims and risk factors.

What Affects Your Choice of Business Insurance?

Now you’re familiar with the different types of insurance, we can explore the factors that will affect your decision of business insurance policies. Not all of the policies we’ve covered will be needed for every business, so matching policies to your business needs is extremely important.

The Nature of Your Business

Because there are so many types of businesses out there, there are also a lot of insurance policies to choose from to reflect that diversity. This means that some insurance packages will be great for some businesses but unnecessary for others. This is why it’s so important to consider the nature of your business to ensure that you don’t take out insurance that you simply don’t need. For example, if your business is focused on selling physical products, you likely won’t need a professional liability policy. And in that same vein, if you’re the sole employee at your business, workers’ compensation coverage isn’t needed for your business.

Business Resources and Assets

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There are many insurance policies available that protect your business assets, such as buildings and vehicles. If you have a fleet of vehicles or a storefront that you operate from, then you’ll need specific and dedicated insurance policies to protect them in the event of an accident or damages being sustained to them.

Risk

Depending on what industry you operate in, the level of risk can vary substantially. For those in less risky industries, there may not be a need to take out extensive insurance policies with high excess covers. But for those in more volatile markets and environments, insurance is a must.

You Need Insurance that Protects Your Business

After looking at the numerous insurance options available to business owners, you’ll be able to understand what policies are necessary for your business. It’s easy to be oversold on insurance policies, which is why it’s so vital to have a sound understanding of business insurance so you don’t overpay for your insurance. The best insurance will protect your business against any potential legal claims, accidents or unprecedented circumstances, so make sure you choose the right policies for you.

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