Types Of Commercial Insurance That All New Businesses Should Have
If you're starting a new business, you should know about the types of commercial insurance that your business should carry. Although this may not be the most interesting part of starting a new business, it can be one of the most important things that you can do for your business. You can do everything perfect when it comes to running your business and have a very profitable year but if you are sued, all of your hard work and effort will have been for nothing if you don't have adequate commercial insurance.
There are basically three types of commercial insurance that new businesses should carry. The first is property insurance. Property Insurance will cover your physical place of business in the event that there is a disaster such as a fire or an earthquake. It's important to understand when purchasing property insurance that not all disasters are automatically covered. Some disasters such as floods are not covered under standard property insurance policies. They must be purchased as ad on policies.
The next type of insurance that you should concern yourself with is liability insurance. This may be the most important insurance that you can carry on your business. Liability insurance will protect your business in the event that you or one of your employees does something that causes injuries or financial loss to another entity.
The last type of insurance to concern yourself with is workers' compensation insurance. Depending upon the municipality where your business is licensed, you may not have any choice as to whether not you carry a workers' compensation insurance. In many cases workers' compensation insurance is required to do business. Even if it isn't required, it makes sense to have workers' compensation insurance policy in the event that one of your employees is accidentally injured. If you don't have this type of insurance and one of your employees is injured on the job, you will be on the hook for paying for all of their medical bills and lost wages. This can devastate a business and completely bankrupt it.
Property Insurance or Liability Insurance?
Do you know which type of insurance cover you need for your business? There are two main types of insurance, commercial property insurance and commercial liability insurance.
Property insurance covers your businesses premises from risks such as fire, theft and damages as a result of the two, it can also cover you against crime and vandalism to your property as well as other specifics such as cover for your property whilst in transit. Under the property insurance bracket there are a few more types of cover that you can get and their need is based on which type of business you run. Your approval for any type of commercial insurance is almost always subject to risk assessment. It can be hard to obtain any kind of business insurance if you business is considered at high risk.
Liability insurance covers your business in the event of legal action being taken against your business. It will cover legal fees as well as cover the cost once the action is completed, again there are other more specific types of insurance that fall under the liability insurance bracket and your business may or may not need them all. An insurance agent can take you through all the details and will be able to tell you exactly which type of insurance you need but in almost every case any business operating will actually need both property and liability insurance, what varies is the more specific categories of insurance that fall under these two types, some of the more specific types on insurance include, errors and omissions insurance, inland marine cover, fidelity bonds and business interruption insurance are just some of these extras.
Prices for both types will vary from insurer to insurer and will be based partly on risk assessment and your specific needs, it is advisable to get more than one quote before you purchase any cover for your business.
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