7 Insurance Policies Every Business Needs
7 Insurance Policies Every Business Needs
Insurance policies aren’t usually the first thing you think about in the morning, but that doesn’t mean it’s not vital to your business. When you’re not covered you open you and your business up to all sorts of trouble. Here’s an example: You get to work and notice that there is a buzz amongst the staff that is abnormal for this time in the morning. Not thinking too much about it, you grab your coffee and head to your office when someone asks, “Have you heard what is happening?”
At this point, your curiosity has peaked and you settle in and start checking your emails where you learn that a customer has been injured at one of your locations and is threatening to file a lawsuit. Scenarios like this, and even worse, are always hanging over the heads of business owners. It is one of the few things that may even keep you up at night. What if someone is injured? What if a sexual harassment suit is filed against one of my managers? What if the building catches on fire? What if an employee is embezzling?
Running a business has a lot of risks, some greater than others, but with a good plan, some of the risks that come with owning a business can be shifted away from your own pocketbook. This is where having a comprehensive insurance strategy comes in. Below, you will find the seven types of insurance policies all business owners must have in place when their business starts.
Worker’s compensation coverage is required in most states and provides coverage for an employer in the case where an employee is injured on the job. The cost of coverage is determined by the work being performed by the employee and can vary depending on how risky that job is deemed to be. For example, a roofing company pays more in premiums than a company full of office workers.
General liability insurance protects your business from claims that occur during normal business operations. This can cover physical injury claims, property damage, and even litigation costs. The cost of general liability coverage can vary from business to business due to each organization’s unique circumstances. This type of coverage is often times packaged together in a Business Owners Policy which combines the general liability and commercial property coverage into one policy.
Commercial property insurance covers the physical assets owned by a business in a similar way that your homeowners’ policy covers your personal assets. This policy can protect against fires, burst pipes, vandalism, and even floods or earthquakes if added to the policy. Commercial property doesn’t only cover real property, but can also cover personal property such as computer equipment, furniture, etc.
If your organization provides professional services, Professional Liability insurance is a must-have! This coverage protects you from mistakes in the services you give to your customers. This can cover negligence, inaccurate advice, misrepresentations, and even libel or slander. Professional liability coverage is often referred to as errors and omissions insurance (E&O).
Employment Practices Liability Insurance (EPLI)
With the increase in social awareness, the amount of lawsuits being filed by employees against their employers is on the rise. These lawsuits can stem from sexual harassment, discrimination, wrongful termination, and a variety of other issues. EPLI coverage provides financial protection from the attorney and court costs associated with these lawsuits, as well as the potential judgments that can be determined.
Do you ever worry about your employees stealing from you? Crime insurance can help reduce that anxiety. This type of coverage protects your business from losses caused by employee theft, fraud, and forgery, as well as some third-party losses.
Cyber insurance is a rapidly growing product in the insurance world. As businesses become more and more digital, the threat of a cyber attack increases. Cyber coverage protects your business from the indirect financial loss that comes with data breaches and other types of cyber attacks.
Insurance is a Must-Have for a reason
I always equate buying insurance to buying tires for my car: I hate doing it, but I also must have them. I don’t necessarily enjoy going to the tire shop and picking out the right tires, but I know that if something goes poorly when I’m driving, having the right tires on my car will help me respond to those situations appropriately. Similarly, no one likes to go through all the insurance options but when that employee lawsuit comes up, or a customer injures themselves on your showroom floor, having the right coverage does provide a little peace of mind during a difficult time.
Interested in learning more about how to protect yourself and your business with insurance? Check out THIS episode of our One Step Better podcast.