Business insurance refers to any insurance policy you take to protect any aspect of a business., and it is crucial for all types of business from small local stores to multinational corporations.
There are many types of business insurance policies, and which policy you particularly need will depend on the nature of your business.
Of all the types of business insurance policies in existence, some are a lot more common than others. You will find almost all businesses have either of the following types of insurance:
Professional Liability Insurance
Also known as errors and omissions (E&O) insurance, professional liability insurance covers the business from claims against harm caused by professional mistakes or negligence. Since each industry and business has different concerns, there is no single professional liability insurance policy that is alike.
You can also view professional liability insurance as cover against the mistakes that your employees make. Their mistakes do not have to negatively affect your business.
Employees Liability Insurance
The second of the most common forms of business insurance is employee liability insurance also known as worker’s compensation insurance. As the name suggests, it is insurance against any claims that your employees can bring against the business.
One of the most common claims made against businesses are employee injury claims. Every business should get this type of insurance as employees can be injured in countless ways. Businesses in more dangerous industries like security and mining need it more than say IT businesses for example.
You need worker’s compensation insurance even if you only have a single employee. The more employees your business has, the more necessary employee liability insurance becomes.
Property Insurance
Every business owns some type of property. While some own more than others, property insurance is vital if you are to protect the physical assets of your business.
Property insurance covers equipment, signage, inventory and furniture among other forms of property. Buildings, land, large machinery are also covered by property insurance.
Property insurance typically does not cover natural catastrophe such as floods, earthquakes and tsunamis or hurricanes. You will require a separate policy for such issues.
Product Liability Insurance
If your business supplies products or creates them, you will have to get product liability insurance for your business. As good as your products are, you will occasionally receive a claim against defective products that can cost your business a great deal.
Product liability insurance is vital because it covers you from any harm of damage caused by a product offered by your business. You should have this type of insurance whether you manufacture or supply the product.
Product liability insurance will typically cover a specific product. To cover a wide range of products, you will have to take separate policies for each product.
General Liability Insurance
As you can probably tell from the name, general liability insurance covers a wide range of claims against the business. It covers any expenses and fees that may result from bodily injuries or other causes for which the business is responsible.
General liability insurance will protect your business from claims of defamation and slander. It will also cover your employees and can include a clause on property damage.
Every business should have general liability insurance as their primary insurance cover. They should then take up specific insurance policies for the cases which the general insurance does not cover.
Business Interruption Policy
Business is a matter of cycles where sometimes it is up and sometimes down. However, sometimes your business may be interrupted due to an unforeseen factor. It may make you temporarily or permanently shut down your business.
For such situations, you need a business interruption insurance policy. You should have it whether you run a brick and mortar business, a home-based business or an online business.
The cover will help cover the costs of the business which you incur when the business is not generating any revenue.
Cyber Insurance
No business can exist without an online presence in the modern age. However, with online activities comes the danger of cyber-attacks.
Cyber insurance will protect your business against malware attacks and data loss among others which can seriously hamper your business. It can also protect your business from the loss of hardware caused by a cyber-attack, so make sure you choose the right type of cyber insurance that suits your business best.
There are other insurance policies that businesses use, but the above mentioned are the ones an average business most probably needs. Evaluate your business so you can get insurance to cover all bases. The safety you get is quite priceless.