Owning your own business is a challenging endeavor, and you’ve undoubtedly got a lot on your mind. Taking care of day to day operations is a full time job, so you probably don’t spend much time thinking about “what ifs”.
What if, for example, your office burned down or your inventory was destroyed in a warehouse fire? Or what if you were sued for sexual harassment by a disgruntled employee? Would you be prepared?
Business or commercial insurance protects your assets if you are liable for many different types of third party claims. But many business owners have no clear idea of what type of insurance they do and don’t need.
Since no two businesses are exactly alike, the type and amount of coverage appropriate for your company is difficult to predict. But if you own a small business with fewer than 20 employees, the questions below will help you determine what kind of coverage you need.
Do You Own A Small Business?
No matter what type of business you own, Commercial Liability Insurance is the backbone of your coverage. It protects your assets in the event that someone is injured or suffers damage to their personal property at your place of business and helps pay your defense costs if you’re sued.
If you are a professional service provider, such as a financial consultant, attorney, insurance agent or realtor, you may also need Professional Liability Insurance (Errors & Omissions coverage) in the event you are sued in connection with services you provided that caused a client financial or other harm.
Do You Own or Rent An Office?
Commercial Property insurance will help you rebuild your office and any adjacent structures in the event they’re destroyed in a fire, windstorm or other weather-related event. Commercial Property insurance is available as stand alone coverage, but it can also be bundled with your Commercial Liability insurance in a vehicle known as Business Owner’s Policy, or BOP. Not all small businesses qualify for this bundled coverage, but talk to your Carmoon Group agent to find out if you do.
Do You Have Employees?
If you have any employees, most states require that you carry Workers Compensation Insurance, which protects employees who are injured on the job. This no-fault insurance also protects you because it pays an injured worker’s medical expenses, rehabilitation costs and a portion of his lost wages. That means the injured employee doesn’t have to sue you to get the help she needs.
Most small employers also need Employment Practices Liability Insurance to protect their assets in the event they are sued for discrimination, wrongful termination, sexual harassment or other employment-related claim. Small businesses are especially vulnerable to these types of lawsuits because they rarely have a dedicated Human Resources department to advise them about applicable state and federal laws.
Do You Take Credit Cards?
If you accept credit cards or electronic payments, your customer’s financial data may be subject to a cyber attack. Even businesses that simply store customer information on a server are vulnerable to hackers, malware and denial of service attacks. Protect yourself from the financial consequences of a data breach with Cyber Liability insurance, which will assist you in paying for customer notifications, credit monitoring and the cost of complying with state and federal laws.
Do You or Your Employees Use a Vehicle for Work?
Even if you don’t own a dedicated company automobile, if you use a car, truck or van in your business, your personal auto insurance will not cover you if you or an employee is in a crash. You need Commercial Auto Insurance to cover any vehicle titled in your business’ name, and Hired and Nonowned Vehicle Coverage to insure any personal or rented vehicles that you or your employees use for work.
Are You a Nonprofit?
The directors and officers of nonprofit companies are subject to intense public scrutiny and are more likely than for-profit executives to be sued. To attract and retain the most talented professionals, many nonprofits purchase Directors & Officers Insurance, which covers legal fees, defense costs and any monetary judgements for a director or officer who is sued in connection with his role as a member of the board.
Do You Sell Liquor?
If you own a catering business, bar or restaurant where alcohol is served, Liquor Liability insurance is a must. In all 50 of the United States, your business can be held liable for alcohol- related damages that occur on your premises (such as a fight between patrons.) Additionally, all but eight states hold businesses that serve alcohol liable if they serve liquor to an intoxicated patron who then leaves the premises and causes property damage or injury to anyone, including themselves. Liquor liability insurance will help defray the cost of any legal action resulting from these kinds of issues. What’s more, it is legally required in most states.
Do You Have a Lot Cash on Hand?
Few small businesses have a lot of extra cash in the bank, which means they are ill-prepared if they should find themselves the subject of a long and costly lawsuit. With Commercial Umbrella coverage, you can increase the limits of your Commercial Liability and Commercial Automobile insurance by $1 million increments for a very affordable rate.
At The Carmoon Group, we specialize in creating small business insurance packages tailored to your unique needs. We work with a large network of affiliates rather than a single insurer, so we can find you the best coverage for your company at the most affordable rates. Call us at 516-292-3780 to set up an appointment for your insurance review, or request a free quote online now.