Does your Small Business have the best insurance?

Here are six policies you more than likely have to have.

Purchasing commercial insurance is an enormous task for a small business to undertake. Partnering with an independent insurance agent is a good way to let the insurance professionals make sure your business is completely covered and that you are not paying too much for premium. No matter how you go about securing coverage here are six coverages all businesses should strongly consider securing.


General Liability

General Liability Insurance is required by law for most businesses, in most industries, and in most states. For that reason, it is usually the first insurance policy any business owner purchases. A General Liability Policy will cover your business for property and bodily injury claims caused by the actions of you and your employees. This is an essential policy no matter what industry you operate in.


Workers Compensation

Workers Compensation Insurance is also required by law for most businesses in most states. Even if your business is not required to carry coverage, it is more than likely in your best interest to secure coverage. This is because you are required to cover medical expenses and some lost wages for your employees if they are hurt during normal business operations. One injured employee can amount to several hundred if not thousands of dollars. If your business does not have this excess cash on hand to cover these costs, it may cause your business to close its door permanently. In order to prevent this it may be wise for you to partner with an independent insurance agent who can help you make sure you are getting the absolutely best coverage at the lowest workers compensation insurance rates.


Cyber Insurance

Cyber Security is an extremely big problem for businesses today. It is no longer just a problem for big businesses. Target and Home Depot are two of the largest data breaches in history and they were both started by criminals first hacking in to the computer systems of a small business who had a relationship with the larger corporations. This is becoming a common way for hackers to access large databases. Because of the fact that all businesses are facing more of a threat in the cyber realm and the fact that there is more pressure from consumer to have a presence online, the need for cyber insurance will continue to grow both in the near and long-term future.


Employment Practices Liability Insurance (EPLI)

Employment related lawsuits have grown in frequency and severity over the past decade. Everyone thinks they have trustworthy employees who would never sue the company, until one of them does sue your company. Lawsuits do not have to be founded in fact to cost your business an immense amount of money. An EPLI Policy will protect your business against the costs of a lawsuit up to the limits of the policy whether the lawsuit is founded or not. In many instances, having this policy in place can mean the difference between a lawsuit being a difficult stumbling block and something that causes your business to close permanently.


Umbrella Policy

An Umbrella Policy is designed to be a policy that sits on top of all your existing policies in the event a claim is large and the existing policy does not cover all of the damages. The one common misconception about this policy is that it is all encompassing, which it is not. This policy only kicks in to place over an existing covered loss. If the claim in question is not a covered loss, the Umbrella Policy will not kick in. This is important in an area that has natural disaster risks like tornadoes in the central plains or hurricanes in Florida. If you do not have hurricane or flood insurance in place, an umbrella policy will not kick in to cover a loss that is not otherwise covered. If you have a hurricane policy in place and it does not cover all of the damages you incur, an umbrella policy can help with the additional costs you face.


Business Owners Policy (BOP)

A business owner’s policy is always something a business owner should look into because insurance carriers are more likely to offer better policies and dig deeper for discounts when they know you are going to buy multiple policies from them. Purchasing a BOP is also good for preventing a gap in coverage. Insurance policies have a lot of grey area. A general liability policy is not standard across the board from one carrier to the next. For this reason, if you purchase general liability from one carrier, cyber insurance from another carrier and a professional liability policy from a third carrier; there may be a time when you have a claim that falls in the grey area in between all of these policies exclusions. When purchasing a BOP, your insurance agent and the underwriter who is representing the carrier can work together to ensure there are no gaps in coverage for your business.


Walt Capell is the president/owner of Workers Compensation Shop. Founded in 2005, Workers Compensation Shop is a rapidly growing national insurance agency with a strong reputation for forward-thinking, out-of-the-box products and solutions for business owners.

Posted in: Personal Finance

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