Before you started your own business, you thought you needed many different types of insurance. Now you know that it was nothing compared to what you need to protect your company. Most business owners know that general liability and workers comp insurance are mandatory. But now you’re learning about a ton of other types of insurance that you need as well.
Depending on which state you’re located in determines the types of insurance that are mandatory. Insurance can be costly and seem like a waste of money, especially if you haven’t needed it. But believe it, or not even the policies that seem pointless may one day be the one that helps your business succeed.
Below, you’ll find the six main types of insurance needed for businesses. Some of them are common sense, and others may surprise you.
Professional Liability Insurance
You’re probably aware that you need general liability insurance, but perhaps this one is new. This type of insurance helps protect you against claims of negligence or mistakes in services you made. This insurance is essential for anyone who provides services such as attorneys, accountants, real estate agents, and hair salons. Some states require this type of insurance to businesses that offer services
Business Car Insurance
You probably think “I already have car insurance. Why would I need to change it?” Now that you own your own business, you need to make sure that you have business coverage to protect you and your company against lawsuits. Your personal car then becomes a company car, if you don’t purchase a separate vehicle for your business. Get multiple car insurance quotes and compare their rates. Keep in mind cheaper isn’t always better. It would be best if you also considered adding umbrella coverage to your policy for even more protection.
Cyber Liability Insurance
This type of insurance is now more critical than ever. Small businesses are considered the easiest ones to hit because they often don’t have the finances to purchase IT services that help protect against this threat. If your company falls into this category, there are many steps you can take to help avoid cyber attacks. And in case you do fall victim to one cyber liability, insurance will protect you.
Business Interruption Insurance
This type of insurance is in case of unexpected disasters that shut down your business. If you can only run your company in a physical location such as a retail shop or manufacturer plant, this type of insurance is essential for you. If you own a small business, a few months being shut down can put you out of business. If you are covered by business interruption insurance, it can cover some, and sometimes all, of your business expenses.
Property insurance is essential if you own your building. Even if you don’t own your property and are leasing, you’ll want to get this insurance in order to protect your business items such as computers, inventory, or tools. This will help protect you against things like fire, vandalism, theft, smoke, or other types of damage. Even if you work from home, this is good insurance to get.
Along with general liability, this is the most important insurance you can get, especially if you have employees. If you don’t get this insurance, you can face very high fines, penalties, and even criminal charges. Not to mention if someone is hurt on the job, you could lose everything.
This insurance is so essential because if an employee is injured or ill due to something job-related, they get benefits. In exchange for specific benefits, the employees agree not to sue their employer for the incident. Not only does this insurance protect your employees, but it also protects you and your business.
Benefits Workers Comp Can Assist With
- Medical bills
- Replace lost wages
- Cost of a funeral if needed
- Pay for ongoing care
You’ve spent years building your business and are determined for it to succeed. You do not want to put it at risk from negligence of proper insurance on your part. While some of the insurance policies may seem pointless, they are a safety net in case you ever need it.