People have a funny relationship with insurance. For most, their focus is on cost-of-coverage or if they even need insurance. Once you’ve been in business long enough however, you realize that sooner or later things go wrong. When they do, it’s not just important to have coverage, but to have the right kind of coverage and the right amount. Take a look at the following types of business insurance so you can prepare yourself (and your business) in the best way possible for whatever lies ahead.
General Liability
This basic coverage protects policy holders from injury to other parties, and damage to other people’s property. In short, if you or one of your workers accidentally breaks something, you’re covered. For some businesses, this is all the coverage you need. For others, their industry requires slightly more comprehensive policies like the ones below.
Property Insurance
Having property insurance covers your tangible assets. This can include your land, inventory, office building, equipment and even furnishings. How much coverage do you need in this case? It’s tricky. This is one area people tend to be over-insured, so make sure you give your policy careful consideration. First-rate coverage can come in handy if you rely on specialty equipment or products to make your revenue, but may not be necessary if you work in an industry like consulting. If that’s the case you may need something like professional liability insurance.
Professional Liability Insurance
It’s hard to get things right 100% of the time. Your customers, however, might not see it that way. If you are in the service industry, Professional Liability Insurance, or Errors and Omissions insurance, is extremely important to have. This coverage protects you from being sued for unintentional mistakes made in the course of providing services. Having such insurance can be especially important if you’re in the business of giving advice (e.g. consultants and marketing firms).
Product Liability
If you’re a craftsman, manufacturer, retailer or anyone else who makes their revenue from selling products, (even food), then this is for you. This covers liability if a person is injured using your product. It also covers damages to bystanders and, in some cases, can even cover a failure to warn or defect.
Business Interruption Insurance
Weather conditions and natural disasters can damage your property or impede on your business’ ability to run operations. When that happens, you lose revenue and still have to cover your expenses. Business Interruption Insurance can keep you from going under while you get back on your feet. Depending on your needs, you can select the types of interruptions covered and the desired level of coverage. Things like lost inventory and even salaries can be covered, so make sure you research your options thoroughly.
Key Man Insurance
Also known as Key Person Insurance, it’s basically life insurance for that person in your business holding everything together. If you have a particularly skilled or experienced employee that your business could not run without, consider taking out a policy for them, as well as one for yourself, the founder. The way it works is simple: often times, if a key person in a small business dies, it can often mean the end the business itself. Instead, take out a key man insurance policy. That way, if the unfortunate happens you can use the policy payout to stay afloat. It can be used to cover overhead costs and keep the company running while you find someone new, or pay for expenses while you “wind up” and close your business.
Whether it’s an on-site accident or an act of god, unfortunate things never happen at a convenient time. With a little extra research, however, you can get the best protection possible. Just ask the right questions “left of the bang,” and have the necessary peace of mind to focus on running your business. To inquire about our various types of business insurance, or for any other questions, please contact TJ Woods Insurance Agency today.
