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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need internet business insurance

Traditional business owners would not dream of starting a business without proper insurance in place, yet most internet businesses never bother to ask who needs internet business insurance? This is because usually customers do not visit their place of business and most of the time a vast majority of the internet businesses are home-based.

Working from home makes one feel secure that nothing bad can happen or their homeowners’ insurance covers the basic machinery like the computer, printers or other related equipment and they are satisfied.

Protect your internet business with the proper business insurance. Save time and money by comparing quotes online to find the best possible rates available from all the major insurance companies!

Why Internet Businesses Need Insurance

Internet based businesses that are working with setting up websites or anyone that publicizes information on the world wide web has to take into account new risk posing scenarios like:

  • Infringement of privacy or breach of confidence
  • Defamation
  • Mishandling of confidential information or that which is under statutory restrictions
  • Violation of property rights

While currently there are no set standards that cover cyber liability insurance, there are some things one should consider to protect themselves:

  • Get a clear understanding of why internet business insurance will be beneficial.
  • Use internet business insurance providers to get a clear picture of what is at risk.
  • Complete the protection package with coverage for items like servers, building, computers, etc.

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Types of Insurance Necessary

types of insurance for internet business

Contrary to popular thinking, the main concern of an internet business is not just protection against loss of equipment and materials, but many other things that a business just cannot do without. The most common types of insurance include property, liability, workers’ compensation, malpractice and legal help. Obviously, there are others, but learning about the different types and analyzing one’s own needs will go a long way in determining which business insurance one needs and how much is best for one’s own requirements.

1. Property Insurance – If the premises of an internet business are leased, then property insurance may be mandatory. If it’s in a home office find out if the homeowners’ policy covers the business equipment. When the value of the equipment is minimal, to the point that the insurance premiums cost more than the value of the machinery, then property insurance is not worth having. If, however, the equipment is costly, then it must be properly protected.

2. Liability Insurance – Liability can arise out of any type of business and the internet is no exception. If the internet business is such that it provides a service to customers or other enterprises, then liability is always a possibility. Calculating risks is the best method of determining how much liability insurance is needed.

3. Workers’ Compensation Insurance – This is a necessity for businesses that have employees, but different states have different laws. For example, some states only require this insurance if the business has a minimum of three employees. This type of insurance helps to pay salaries if an employee is injured on the job.

4. Malpractice Insurance – This insurance becomes a must in businesses that provide services requiring licensing. It is also known as Professional Liability and is usually associated with services like counseling, medical, accounting and architectural.

5. Prepaid Legal Insurance – This policy covers legal costs that are associated with defending ones’ self. It is a good safety net to have in case one requires legal aide.

6. Internet Business Insurance – This is especially created for online businesses like web hosting, web auctions, web blogs or other online businesses. It provides protection against losses that may be caused due to copyright issues, trademark violations, hacking and a host of other damages an internet business is a target for. The coverage can be modified to suit the business operator’s needs. It also makes available programs that can prevent attacks and any risks that may follow.

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Internet Business Insurance

Internet business insurance is still a very new concept. Not all of the provisions available in the traditional businesses are yet available for online businesses.

For example, not all of the losses resulting from operational setbacks may be covered in the internet business insurance. Online business puts clients and businesses at risk, because both parties exchange personal information online. Things like names, photos, social security numbers and credit card accounts are shared online. If this information is not protected, the customer will not trust the business, and the business will not be able to compete online. However, businesses are at the mercy of hackers, because online security is still an imperfect art. While internet business insurance cannot guarantee security, it can help the business recover from any losses resulting from security lapse.

The cost of internet business insurance is determined by the coverage requested, degree of risks one plans on insuring against and any add-ons to the policy. The amount of coverage depends on the kind and location of the internet business. Customizing an internet business insurance plan requires determining one’s obligations to employees, law,clients and amount of security.

How to Choose an Insurance Company

To make sure one gets the best deal have several insurance companies who assess risks and other factors provide quotes. This allows one to weigh available options. Remember to check the company’s service and trust rating. Before settling on any one company, get recommendations from other like businesses.

Begin comparing quotes online with our FREE quote comparison tool below. Enter your zip code to begin!