Choosing insurance for a small business can be a daunting task. There are insurance products for virtually every kind of risk. You need the help of an insurance agent to sort out, which policies meet your business needs. Furthermore, you need to find out what situations are excluded on each policy.
One of the most comprehensive insurance for a small business is general liability. General liability offers coverage in a number of different areas:
Property Damage kicks in when you damage the property of a third party. For example, you’re a roofer doing work at a client’s home, and a package of shingles falls off the roof and damages your client’s outdoor furniture. That damage would be covered by your general liability.
Bodily Injury happens when a third party is harmed at your business office or work site. For example, a customer comes to your office and slips and falls. That injury will be covered by your general liability.
Personal Injury comes into play when you slander a third party. For example, you bad mouth a competitor, and that person finds out and sues you. Your general liability will pay your legal expenses.
Copyright Infringement takes place when a competitor sues you for utilizing his advertising. For example, you go to your competitors website, and you like his advertising and decide to model your advertising after your competitor’s.
Workers compensation is a must for anyone who is looking for insurance for a small business.It’s required by law. Most states have laws that make having workers comp mandatory.
It pays for the medical expenses, rehabilitation and lost wages for your injured workers. It doesn’t pay for injuries sustained outside the workplace and not related to the job. Often, workers compensation is bundled with general liability.
Business Owner Policy (BOP)
BOP is a good choice for insurance for a small business. It contains general liability. General liability is a third party insurance. It protects your client or other third parties from damage or injuries caused by you. This means that damage or injury to you is not covered under general liability. That’s why BOP is usually bundled with a policy that covers your losses. Many times, it is paired with property liability insurance, which covers damage to your business furniture and equipment.
Professional Liability Insurance
You should consider professional liability if you’re shopping for insurance for a small business. It protects you from claims of negligence in providing your service. According to the Small Business Administration:
“Business owners providing services should consider having professional liability insurance (also known as errors and omissions insurance). This type of liability coverage protects your business against malpractice, errors, and negligence in provision of services to your customers. Depending on your profession, you may be required by your state government to carry such a policy.”