Business insurance comes in a number of wide varieties depending on the needs of the business, so it is essential to understand what types are available and know if they are appropriate for your business. Depending on that state and the type of business, certain types of insurance may actually be required.
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Property insurance is basically coverage for any type of damages or losses relating the property or any personal effects that may be within it. This is a very common type of commercial insurance and it is almost mandatory for anyone that wants to build a successful business. The actual structure of the business as well as the equipment and merchandise must be insured if the building is damaged by a fire or flood, for example.
Home Based Business Insurance
Even home based businesses need an insurance policy. Most home insurance policies generally do not cover losses regarding a home based business, so for example if your home office was destroyed in a fire, then the policy may not cover those losses. It is possible to add an addendum to your home insurance policy for the extra coverage, but it is also possible to buy a separate home based business insurance policy as well.
Commercial Property Insurance
Commercial property insurance is available for businesses that are located in commercial property like office buildings, industrial parks, and etc. This will cover any type incident like a fire, storm, or vandalism. Usually, this type of coverage also offers extensive coverage of the items within the building like equipment, computers, documents, and even business interruption.Business interruption can cover a wide array of costs such as lost income, taxes, net profits, salaries, and rent.
Commercial property insurance could be peril specific or all risk depending on your agreement with your insurer. Peril specific means that it will only cover specific things like fire, storms, or vandalism. All risk means that it will cover a number of different types of incidents unless it was noted in the policy that it would not be covered.
Professional Liability Insurance
Professional liability insurance is also known as errors and omissions insurance, which is designed to protect businesses that offer services to customers in the event of allegations of neglect, malpractice, and errors. Professional liability insurance is basically there to protect the owners if there is some sort of error or mistake in their services whether it is a computer repair shop or a dentist’s office. This type of insurance is required for certain professions like all doctors are required to have this for their private practice.
Malpractice insurance is designed to provide coverage for anything that falls below the standard of care for the profession. This is usually for medical professionals, but other professionals can obtain it as well such as accountants and real estate agents. This is also a form of professional liability insurance.
Product Liability Insurance
Product liability insurance is a necessity for any company that designs,sells, distributes, or manufactures products in the event that they are sued for any defects or injuries that may result from the use of the product. Many retail stores have this type of coverage, but it is more important for certain businesses like if they sale weapons or fireworks as opposed to an office supply store.
Ordinance insurance is not that common, but it covers the costs associated with rebuilding and demolishing a business if it is the result of a city ordinance. For example, if a fire destroys most of the building where your business is located and your business was unscathed, the city may require that the building be destroyed anyway due to their local ordinances. In this case, the insurance policy would cover the costs associated with the demolition and also cover the cost of rebuilding the business in another location.
This is a bond that covers any type of theft that is perpetrated by an employee working at the company.
Crime insurance is available to protect the building and the equipment from vandalism or theft caused by employees or people outside of the business.
Workers’ Compensation Insurance
This is insurance for employers to cover any type of injuries and accidents that can cause physical and emotional injury to their employees. This could be anything like a employee slipping and falling on the floor to an employee getting a limb caught in a machine. Workers’ compensation insurance is actually required by some states and for certain businesses. This protects employers because when an employee accepts a workers’ compensation, they are no longer able to file a lawsuit against their employer for negligence or the injury itself.
Tenant’s insurance is often a requirement for businesses that occupy a space within another building like a mall or office building. This will cover them for any damages that may occur as a result of the business occupying the space as well as any damage caused by the employees working at the business.
Car insurance can be issued for any vehicles that are owned by the company in the event that there is any type of accident or damage to the vehicles. Coverage can be obtained for any vehicle whether it is a truck, van, car, or trailer. Car insurance also covers any damage by the employees and it can cover theft as well.
Buying the Right Type of Coverage
Overall, business insurance is a necessity for every business. The type of insurance really depends on the location and the type of business, but all entrepreneurs must eventually get some type of insurance. The right type of business insurance can protect your investment and keep your business running for many years to come.