What Are The Various Small Business Insurance Coverages?
Unfortunately, a small business without insurance is like a man without a home! While starting your own small business is all about numerous possibilities, promises, and growth, an unprotected business is not just vulnerable but a sitting duck for hazards and leading losses. That's why small business insurance is a must for you.
To start shopping for the best insurance for small business, you need to know exactly what can go wrong, if it will go wrong, with your business. While this may sound a little macabre, this is one of the most important steps to zero in on the various insurance risks you'll probably have to tackle, if ever, in future. For example: if you have just started a candle-making business, you should critically evaluate the various risk facts - fire, safety, mishandling etc. Never limit your risk assessment to only to you. Look from the perspective of a customer, assistant as well. While you do this exercise, it's also advisable to have at least 2-3 insurance agents/brokers to carry out a risk analysis of your small business so that you finally choose the best small business insurance policy for you.
Different Types of Small Business Insurance Coverages
While there are different types of small business leading to different insurance requirements, here's a brief checklist of various coverages you can consider.
1. Business Owner Insurance - Also known as "catch-all" coverage, business owner insurance protects small business owners from damages caused due to fire and other such misfortunes. This small business insurance also offers a certain degree of liability protection.
2. Liability Insurance - One of the best types of small business insurance, the liability insurance protects your business from claims of injury, property damage and a range of disasters like dog bite, to a customer burning himself with a candle made by you.
3. Product Liability Insurance - If you have a business like candle making or a floral shop or a catering business, you may consider taking this type of small business insurance coverage. Product liability insurance is especially beneficial for those who make products that have the potential to harm the user.
4. Errors and omissions insurance - All service-based business owners must take out this insurance. Errors and omissions insurance offer you protection against mistakes or neglect of actions that may cause your customer some harm. For example: if you are a doctor with your own practice, you should have a medical malpractice insurance, which is state required anyway.
5. Business Income Insurance - Since you don't know if a disability make hamper your ability to run your business, business income insurance, a type of small business insurance, ensures that you still get some money in case your business shuts down temporarily due to damage, or incase a situation limits your small business.
Other small business insurance like property and automobile insurance can also be looked at. However, the thumb rule to remember is that you should never go for insurance that is inadequate. Remember, chunky insurance premiums may be expensive debits but they are extremely important for sure.