When you’re running a small business, one of the most important aspects to consider is your liability. Without insurance, if something terrible happens, you’re on the hook for it. But there’s more than one way to go with insurance. Find out in this article what type of coverage is right for your small business and keep yourself covered!

1. Know Your Liability Coverage

As a small business owner, it’s important to understand your liability coverage and make sure you have the right insurance in place to protect your business. Liability insurance can help cover the costs of legal fees and damages if you are sued for something like personal injury or property damage.

General liability insurance is the most common type of liability insurance for small businesses. It can help protect your business from claims like bodily injury, property damage, and more.

Product liability insurance is another type of liability insurance that can be important for small businesses, especially if you sell products. This coverage can help protect you from claims related to injuries or damages caused by your products.

Talk to your insurance agent about the right liability coverage for your small business. Make sure you have the protection you need to keep your business safe from legal trouble and financial ruin.

2. Who is Insured?

If you have a small business, you need to make sure that you are properly insured. You also need to make sure that all of your employees are covered by your insurance policy. If you have any independent contractors working for you, they should also be covered. You should check with your insurance agent to make sure that everyone who works for your company is properly insured.

You should also consider adding additional coverage for things like product liability or data breaches. Make sure you understand what is included in your policy and what is not so that you can be prepared in the event of a claim.

3. What Does Insurance Cover?

Most small business insurance policies cover four main areas: property damage, liability, business interruption, and workers’ compensation.

  • Property damage coverage protects your business if your property is damaged or destroyed by a covered event, such as a fire or vandalism. This coverage can help pay to repair or replace your property.
  • Liability coverage can help protect your business if you’re sued for damages because of something that happened in connection with your business. This coverage can help pay for the other party’s medical expenses, lost wages, and other damages.
  • Business interruption coverage can help replace lost income if your business has to stop operating because of a covered event, such as a fire or severe weather. This coverage can help pay for ongoing expenses, such as rent and employee salaries.
  • Workers’ compensation insurance can help pay for medical expenses and lost wages if an employee is injured while working for your business. In some states, this coverage is required by law.

4. What Doesn’t Insurance Cover?

There are a few things that most small business insurance policies don’t cover. These include:

  • Professional liability – if you are sued for professional negligence, your policy will not cover the legal costs or any damages that may be awarded.
  • Product liability – if your product causes injury or damage, your policy will not cover the resulting claims.
  • Vehicle accidents – if your vehicle is involved in an accident, your policy will not cover the resulting damage or injuries.

5. Types of Insurance for Small Businesses

There are a number of insurance types that small businesses should be aware of. These include:

Property Insurance

This type of insurance covers the physical assets of your business, such as your office space, equipment, and inventory. If these items are damaged or destroyed in a covered event (such as a fire), property insurance can help you cover the cost of repairs or replacements.

Liability Insurance

Can protect your business from claims arising from injuries or damage caused by your products or services. This type of insurance can also help cover the cost of legal defense if you are sued.

Business Interruption Insurance

Can help cover the lost income and expenses incurred if your business is forced to close due to a covered event, such as a natural disaster. This can help you keep your business afloat during these difficult times.

Workers’ Compensation Insurance

If you have employees, workers’ compensation insurance is required in most states. This provides benefits to employees who are injured or become ill as a result of their job.

How to Choose the Best Insurance for Your Business

The right insurance policy can help you safeguard your business from financial losses due to accidents, property damage, liability claims, and more. Take some time to assess the risks faced by your business.

Get quotes from multiple companies so that you can compare rates and coverage options. Make sure you understand what is and is not covered by the policy. If there are any provisions that are unclear, be sure to ask questions until you get clarification.