Small Business Insurance

Insurance for a small business is necessary even if it is a one person operation working from the comfort of home. As soon as the business starts dealing with anyone in a business sense, there is a level of liability that takes place.

When establishing and maintaining a business, insurance for your business may seem like an unimportant thought, especially if it is a one person business being run from home. A reputable small business insurance agent will help you understand the details of small business insurance and can advise you on what is right for business based on the type of work the business is involved with. It does not hurt to generate some self education and have a basic idea of what small business insurance is all about.

General liability, small business insurance will protect the business owner in the event litigation takes place because of accident, injuries, and claims of negligence. General liability insurance will protect the business against the cost incurred by bodily injury resulting in medical expenses, property damage, slander and libel, the cost to defend such lawsuits and settling bonds and judgments that might be required during an appeal.

Product liability, small business insurance is a must for companies that produce, sell or distribute products. The business is liable for the safety of the product regardless of whether they produced it or just sell or distribute that product. Product liability insurance provides protection for the business against loss of a financial nature as a result of the product it causes bodily injury or some degree of harm to the consuming public. The amount of insurance purchased depends on the product involved.

Professional liability, small business insurance is for the business that provides a service. Sometimes called insurance for “Errors and Omissions”, this type of insurance protects the small business against negligence in the provision of the service to customers. Depending on the service provided, you may be under a state mandate to provide a certain amount of professional liability insurance as a condition of doing business.

Commercial property insurance will provide coverage related to damage and or loss of business property due to such events as smoke, fire and wind damage, vandalism, hail storms and civil disobedience. The insurance will cover lost revenue, business interruption, office equipment, company paperwork and money.

Property insurance is divided into two areas of concern. One is an all risk policy covering a wide variety of incidents except those noted as exempt in the policy. The other is peril specific policy that will cover incidents as list in the policy. A peril specific policy may be purchased if there is a high risk of a certain peril in the area of the business.

For those that conduct business at home, your homeowner’s policy does not cover home based business loss. You may be able to add riders to your home owner’s policy to cover normal business risks such as property damage. There is a limit to what those riders will cover home based business wise and it will be wise to purchase additional small business insurance specific for your business.