No one plan is ideal for all necessities in business insurance. Businesses must try to assess ther risks and assets so that they can choose what offers the best possible coverage out of accidents and disasters. Coverage towards commercial liability claims offering protection in bodily harm, property damage or advertising to many companies is valuable. Other covers available are professional liability policies or even a business owner’s policy BOP.
1. General Liability
General liability insurance will guard your small business from the expenses related to general claims filed by outside parties, such as incidents at your premises or unintentional copyright violation in your advertisements. In the absence of coverage, the legal expenses linked with property and general liability claims can negatively impact a business. In some instances, your small business can be asked to provide general liability insurance in order for you to be part of certain contracts, such as leases for commercial spaces where landlords tend to ask for certificate of insurance as a prerequisite. Great Liability coverage has become one of the leading policies that small businesses get due to the financial protection that comes from the policy.
Once you begin looking for a general liability policy, I recommend that you speak with a business insurance agent that specializes in your line of work. They will learn about your business and develop a policy that addresses its requirements as well as its financial plan. They might also recommend some coverages, such as professional liability or commercial umbrella policies, which provide more protection at cheaper prices compared to stand-alone policies.
2. Business Owner’s Policy (BOP)
A BOP or Business Owner’s Policy is an all-in-one simple package that protects small businesses that qualify from the usual risks, which includes property insurance, general liability, and even business interruption insurance.
Property insurance is necessary for almost every small company that leases or owns a working space and protects against vandalism, burglaries along with extreme weather conditions like flooding. In addition, business interruption insurance compensates for profits lost due to a disaster such as a fire or a flood that would close down your business, as well as having to work out of an alternative temporary location if needed.
Business Owner Policies (BOPs) are tailored for different industries enabling you to include coverage such as workers compensation and commercial automobile policies to suit the industry. Additionally, many clients, landlords and lenders need business insurance to be in place before executing a contract or issuing a loan which helps BOPs to gain favorable terms with clients, landlords and lenders. These are particularly common among small retail stores, restaurants, and service industry businesses that directly serve customers or the general public.
3. Employment Practices Liability Insurance (EPLI)
Lawsuits from employees are becoming more common, which can pose a financial threat to small businesses. As employees receive more legal protection, businesses must be equipped with coverage against claims of discrimination, sexual harassment, and wage & hour issues more than ever.
EPLI (Employment Practice Liability Insurance) protects against loss while defending and settling employment practice claims. This coverage is designed as “gap insurance,” which serves as “gap protection” for claims that don’t fall under general liability policies or directors and officers insurance.
Depending on your organization’s size and risk level, EPLI policies can be bought as standalone insurance or as part of a Business Owner’s Policy. Furthermore, the policy needs to be active at the time something occurs and at the time any related lawsuits are filed; some policies use a cost containment approach through providing access to approved law firms with significantly lowered retainer fees.
4. Cyber Liability
This type of policy assists businesses in managing the consequences of data breaches by providing financial support. Cyber liability policies help with payment of legal expenses, regulatory penalties, costs related to notifying customers, and credit monitoring for customers potentially harmed. Retailers are not the only businesses that would benefit from cyber liability policies, manufacturers, tech companies, and even medical practitioners could.
Having cyber insurance is necessary as lawsuits can be filed against a business if its confidential data is made public. Policies related to cyber insurance can be purchased separately or as additions to an existing policy; some insurers offer a bundle, for example, Hartford’s Business Owner’s Policy includes property insurance, general liability, commercial auto, business owner’s salary, and also business interruption insurance.
If you’re unsure which type of insurance would suit your small business, seek help from an independent agent. These professionals can assess the risks and budget related to your business and suggest coverages that combine multiple policies at cheaper rates.
5. Business Interruption Insurance
Business Interruption Insurance (BI) is designed to safeguard a business that, for any number of reasons, must cease operations temporarily by reimbursing lost income along with other costs like rent, utility expenses, inventory purchases, and loan payments related to the business. It is available as a standalone policy or can be offered as an endorsement to a commercial property policy, or added to a business owner’s policy.
One of the most important types of coverage for a business is business interruption insurance. Even a short disruption could turn out to be financially devastating.
Business interruption policies track the number of days of physical damage that occurs until the point when restoration can begin. This time is referred to as the restoration period and in order to qualify for lost income and operaing expense reimbursement, certai conditions needed to be met, like:
