8 Insurance Types You Might Need For Your Business
Running a business is one of the riskiest endeavors you can take on. As with anything that involves a good deal of risk, insurance exists to protect against the harm that can happen when serious dangers manifest into reality. Without that coverage, many businesses may simply go under. Below are eight kinds of insurance that you might need for your business.
Commercial Property Insurance
Most business owners need to run their businesses out of buildings used primarily for their operations. Inside such a building, there may be many kinds of equipment used to create the products sold to customers. It doesn’t matter if you own or rent a building, you need commercial property insurance to protect against things like burglary, fire, lightning, wind storms, and more. Keep in mind that most commercial property insurance does not protect you from earthquakes or floods.
Earthquake and Flood Insurance
With that in mind, certain businesses should absolutely purchase separate policies to protect against either earthquakes or floods. It depends if your business operates either near an earthquake fault line or in the floodplain of a river. If you do, purchase this coverage. If you don’t, it’s likely not needed. However, make sure to do your research. According to the US government, Alaska and California are most at risk for serious earthquakes.
Business Liability Insurance
Another great risk to businesses is lawsuits. The US is a very litigious society, and businesses, both small and large, are likely to get sued from time to time. In many instances, it’s not if you will be sued but when. Business liability insurance can help to protect your company’s finances from many of these lawsuits. This includes lawsuits over things like slander, libel, copyright infringement, personal injuries, and damage to another party’s property.
Business Umbrella Insurance
Something you may need to supplement your business liability insurance is business umbrella insurance. Umbrella in this case refers to the fact that the coverage acts as an umbrella against lawsuits that extend past specific coverage limits in those policies. The umbrella insurance will then extend that coverage past those limits and help pay for the extra expense. While one would hope standard business liability insurance would be enough on its own, it’s often not.
Business Income Interruption Insurance
If something bad happens to your business, your ability to make an income may suddenly cease for an extended period of time. Thankfully, insurance that protects against the loss of business income can be purchased. Insurance claims can then be used to pay for things like payroll, utilities, rent, loans, and taxes. It can give you the ability to survive while you get your business up and running again.
Commercial Car Insurance
If you use automobiles in the daily operation of your business, you require some form of commercial car insurance. It is required because regular car insurance for individuals won’t cover claims that arise from company-owned vehicles.
This includes claims related to personal injuries and property damage resulting from an accident. In many cases, businesses also require more specific auto insurance plans fine-tuned to their needs. If you have a fleet of dump trucks used to transport materials, you likely need dump truck insurance. A lot can go wrong when hauling or dumping heavy materials.
In certain cases, having specific kinds of insurance is mandated by the US government. This is the case in many states with workers’ compensation insurance that must be bought to protect employees in case they are injured while on the job. Workers’ comp can pay for things like lost wages, medical bills, physical therapy, and more. Its existence is advantageous to businesses because it prevents costly lawsuits that would likely happen without such coverage.
Cyber Liability Insurance
Many of the biggest risks to businesses cannot be seen or detected at all until it’s too late. This is often the case for hackers and cybercriminals. If your website is hacked and your important customer data is stolen, it can eventually lead to huge losses resulting from lawsuits by customers that were harmed by that stolen data. Cyber liability insurance can help protect against this threat so such a lawsuit does not put you out of business.
Many businesses shut their doors forever every single day. However, if some of these businesses had the right kind of insurance coverage, they may have been able to survive. The list above is, of course, in no way exhaustive. Specific businesses in particular industries may require other different kinds of coverage. Overall, make sure you have all the coverage your business needs to survive the likely threats it may face.