Talking With Insurance Companies

When you start a small business and work with the public, you're always at risk of being sued by someone who is unhappy with your work or by someone who was injured. The best way to protect yourself and prevent being driven out of business by a lawsuit is to buy business insurance. Business insurance usually includes property insurance and liability coverage combined, but you can also buy them separately and add additional coverage as well. These are some types of insurance you may need.

Property Insurance

Property insurance pays for damages to your property and equipment. You need this coverage whether you own the building you do business in or rent it. This coverage protects you if your equipment or building is damaged by a storm or vandals. However, like personal property insurance, there will be exclusions you should know about in advance so you can buy additional policies such as flood or earthquake insurance if your property is at risk for those damages.

Liability Insurance

Liability insurance doesn't pay for damage to you or your property. Instead, it pays claims for damages to another person. For instance, if someone falls down in your office due to a wet floor with no sign, then your liability insurance could pay for their medical bills. This type of insurance is important to carry when you deal with the public. A single lawsuit could put you out of business if you don't have liability insurance. This type of coverage is known as general liability insurance.

Personal liability insurance is another type of coverage you can add to your policy. If your business is built around giving people advice, you need this type of insurance to protect you from a claim that you gave bad advice or were negligent.

Additional Coverage

Depending on the type of business you operate, a business insurance policy that bundles property and liability could be all you need. However, you can also buy a more comprehensive policy that includes commercial auto and workers' compensation insurance. Your insurance agent can explain all the types of coverage your type of business needs so you're fully protected. You may only buy liability insurance if you are a solo entrepreneur and work from home. But, when you add employees and company cars, and grow your business, you'll want to add additional coverage so you're prepared for anything.

You can control the monthly cost of your insurance to some degree by choosing the deductible and amount of coverage you need. Other factors that determine cost may be out of your control. These include the age of your business, the type of business you have, and the amount of employees you hire. If you're just starting out and your budget is a concern let your agent know you need help getting a policy that's affordable. Even if money is tight, you still want to buy business insurance because it could save you from a financial disaster.