Chelsey Tucker graduated with a Bachelor of History degree from Metropolitan State University in 2019. She now writes about insurance with her specialty being life insurance and has been quoted on Help Smart Phone and MEL Magazine.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years. He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Mar 19, 2020

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What kinds of businesses need business insurance? More to the point, you probably want to know if your own business needs business insurance. The answer to this is all going to depend on your particular situation and your industry.

In most instances though, practically every business could benefit from having certain forms of insurance.

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Almost every business can benefit from the liability coverage offered by business insurance. However, you will need too look at the services you provide, whether or not you have employees and the type of risk involved in your daily operations to make this decision.

Does my small business really need business insurance?

Probably. No, we’re not saying that if your little daughter runs a lemonade stand you need to get insurance on that particular project. Of course, in this day and age of rampant food poisoning (with practically every case accidental), no restaurant owner or bar owner would dare run a business without liability insurance. Small business owners take on a lot of liability without the backing of others.

Most big businesses have plenty of middlemen to figure out exactly what they need to cover and how to get it as cheaply as possible. What about the new mom and pop business just around the corner, does this business need an insurance policy? Just because your business is small doesn’t mean that insurance is a luxury.

Many smaller companies in fields such as landscaping, home child care, movers, carpenters, up and coming catering businesses and home painters may very well benefit from having certain types of coverage. You may even want to have business insurance on that new lawn mower if it is an integral part of your landscaping business.

Many small business owners are concerned about the high costs of business insurance. However, the cost of not having insurance can be just as intimidating. Remember that small business owners usually put their entire savings into fulfilling this new dream. They may even take loans out to pay for capital.

You personally may have put your very heart and soul into your new business venture. Now just think for a moment if there was a fire on the property. Can you imagine the cost of repairing the equipment and the damaged walls?

Now think about other common threats to small business owners like theft, car accidents, natural disasters, your own temporary or permanent disability. Could your business survive without you for several months? These unfortunate occurrences could put you right out of business.

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What business insurance policies should I consider?

Before you rush out in a panic and buy every form of insurance under the sun, it may help to determine what your greatest risks are. A good place to start is to have someone do a risk analysis for you. With this information, you can determine what you should have covered based on the amount of loss you might suffer.

What types of business insurance coverage does the average business need?

  • General liability insurance is a business insurance policy that most business owners hold. This type of coverage helps if there is an employee or customer accident that results in bodily harm or property damages. Imagine paying for medical expenses out of pocket, or for the fees of an attorney!
  • Product liability insurance is another important policy, especially if you manufacture any products. Your business will be held accountable for the safety of the items it sells to the public. One small defect and a sue-happy customer could take you to court. The legal expenses alone could drive you out of business.
  • Commercial property insurance is going to protect you from losses due to fire, vandalism or even Mother Nature. The amount of coverage for these plans will vary based on your companies risk in each category.
  • Life insurance is another area to consider; although not technically a part of business insurance. If your business could no longer function without you, then having a good life insurance policy in place will help take care of your loved ones.

If there are several owners of the company, you might also think about having a life insurance policy taken out on the co-owner(s). In the case of an untimely death, the policy money can be used to buy up the share of the deceased’s persons business so that you can continue the company without having to deal with family members.

Should I talk to an insurance agent?

Where does the small business owner begin once he or she realizes the need for insurance? Start by talking to an insurance agent who can give you a break down of what your company could benefit from. Even if you cannot afford to insure everything the way that you would like, you should still start with the most important elements so that your business can keep on functioning.

As time goes on and your budget gets larger, you can always add on more coverage until you are satisfied. You can also shop online for some basic forms of insurance and get price comparisons. Always ask for any available discounts from your insurance provider, as these discounts might not be offered up front. You can also speak to a CPA to learn about any tax deductions you might qualify for due to your new insurance contract.

Having insurance will certainly give you peace of mind and allow you to run your business to the fullest. Talk to an experienced agent today or look for business insurance quotes online. You can get started right now using a web chaser tool that compares insurance policies for your area!

Type your zip code into the free rates box and compare business insurance quotes now!