Business insurance can protect you and your employees from a multitude of issues such as damage, fraud, and late payments. No matter what sector your company is in, it should consider at least one type of insurance to ensure its safety.
To help you with that decision, we will explain the most common types of business insurance to cut down your research.
1. General Liability Insurance
Liability insurance protects your business from being accused of harming either a person, a business, or their property. The protection comes in the form of a payout, covering the expenses needed to rectify the problem.
This doesn’t mean that your business’s reputation will stay in tack, but you won’t have to pay if someone fell down the stairs at your club (as an example). This way the person gets the money they need for medical expenses and you are not out of pocket.
2. Professional Liability Insurance
As general liability insurance protects the business, professional liability insurance protects the individual. If an employee makes a mistake, such as medical malpractice, incorrect filing of data, or any other number of issues, this insurance will protect the individual from the hefty fines that follow.
We recommend this insurance for businesses that could create professional negligence.
3. Product Liability Insurance
If you sell products, you should protect yourself with product liability insurance. This will pay out when a buyer correctly claims that your product has caused them physical harm or has damaged their property.
Anyone in contact with your product could file a lawsuit against you. This can be the buyer, a user of the product, or someone who was near the product when it failed.
The product liability insurance can cover the cost of injury or damage claims.
4. Commercial Property Insurance
Commercial property insurance protects your expensive items or buildings from damage. The damage could be from climate change-related weather, accidents, or even vandalism.
Ideally, you should have this insurance on any large value item. For example, if you are a hairdresser, then your sinks and equipment should be insured. If your job requires a lot of travel, then your vehicle should be insured. And if you rent or use a building, that should be protected too.
Anything that is too expensive to replace with ease, but is necessary for your business should be protected.
5. Cyber Liability Insurance
Cyber liability insurance protects your business from malpractice through technology. If your website isn’t secure and you get hacked, this insurance can pay you for the obstruction, and help you repay your customers while you fix the leak.
The policy protects against theft, data breaches, malfunction, and erasure.
Of course, this insurance is well suited to online companies, however, any product that is connected with technology should have this insurance too. Any lack of protection from cybercriminals could put you and your business at risk.
6. Business Income Insurance
If you want insurance to protect your employees from a loss of income, then you need business income insurance. If an accident happens, the commercial property insurance will be able to pay for the damages to be repaired, but they cannot pay for your employees.
If the repair job takes a long time, your employees could quit, leaving you without staff when you can reopen. Planning for this issue with a business income insurance policy can allow you to keep your employees on the payroll while you wait to work again.
7. Workers’ Compensation Insurance
You may have noticed a lot of facebook marketing for insurance agents aimed at workers’ compensation. It is the most important insurance type when it comes to employee protection and satisfaction.
The insurance pays for medical expenses or loss of pay due to injuries in the workplace. This type of protection can help avoid lawsuits caused by injuries and create a sense of comradery due to your willingness to help.
8. Employer Liability Insurance
Employer liability insurance is normally an additional policy for worker’s compensation insurance. Most forms will include it as standard, but you should look out for this addition in case it was missed out.
This insurance covers the elements which lie in between workers and business liability. For example, if a construction worker was injured, but the business decided to take the issue to court, the worker’s compensation would pay for the medical fees (if the business lost the court judgment). However, that insurance would not cover the lawyer’s fees.
This means that some employers will push for a court ruling just to stop the worker from filing a complaint. Employer’s liability insurance pays for the legal fees for both sides of the business so that neither feels pressured out of justice.
9. Commercial Auto Insurance
If your business uses a vehicle as part of its goods or services, then you need commercial auto insurance. This is true for the self-employed and mass companies alike. If there is an accident that involves your work vehicle, you need insurance that is connected to the business and not the person driving it.
This will protect the person from adding more restrictions to their job and will pay out in medical expenses and car replacements.
10. Key Person Insurance
Key person insurance is protection against disability or death for core employees. The best example would be a celebrity working on a movie set. They would have key person insurance as the whole movie revolved around their involvement in the film, without them the whole product would collapse.
Although this is a dramatic example, it can be reduced down to more realistic businesses. For example, if your business is based on one amazing chef’s ability to cook, then you may want key person insurance until they have trained someone to take over.
People with important knowledge that are hard to replace, need to be protected to keep your business afloat. If they were to lose the ability to work, the insurance would pay out the lump sum to help you carry on your business until a new important team member joins.
The best insurance for you depends on the type of business you have. Most people don’t need a key person insurance policy, however, if you are or have a rare person in your employee, then protecting them could be a must.
Understanding how risk can affect your business will help you choose which insurance is needed.