Small Enterprise Insurance Choices – Forbes

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Starting a new business is an exciting time and you should choose the best types of small business insurance policies to protect your business from the potential costs of claims, damages, and legal proceedings. Here is a roundup of the top small business insurances.

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Public liability insurance

Public liability insurance protects a small business from claims arising from property damage and personal injury. As a small business owner, you can be held legally liable if someone's property is damaged while visiting your company, company or business. And if your company is responsible for someone's injuries (excluding an employee's injuries), general liability insurance would also pay their medical bills and lost wages.

Other damages that are handled by general liability insurance include reputational damage, advertising damage, and copyright infringement.

With the help of public liability insurance, your small business will be able to maintain financial stability in the event that you are sued by a customer or another company. In addition to comparisons and judgments, your legal fees are also paid for with general liability insurance.

Lenders, landlords, regulators, and business customers often need general liability insurance before doing business. So there are many reasons to put public liability insurance at the top of your insurance to-do list. A general liability insurance certificate shows that you are properly insured.

General liability insurance costs an average of $ 42 per month, according to Insureon.

Commercial property insurance

Commercial property insurance protects the physical location of your small business and your business equipment, computers and office furniture. Both your own and leased business equipment are covered by this policy.

It takes a lot to start a small business, and there's a lot covered with commercial property insurance. Tools, inventory, supplies, valuable papers, and business records are all covered. Commercial property insurance also covers outdoor facilities such as signs and fences.

Commercial property insurance usually covers any loss of property in your small business due to hazards such as lightning, wind, hail and fire. Commercial property insurance also covers theft and vandalism.

Commercial property insurance has an average cost of $ 63 per month, according to Insureon.

Business interruption insurance

Business interruption insurance replaces lost revenue from a small business when you have to temporarily close due to a damage covered by the policy, such as lightning or fire. Other risks covered by business interruption insurance are theft, wind and falling objects.

If any of these problems hit your small business, business interruption insurance pays for the money lost from damaged goods, lost profits and additional expenses such as: B. the temporary relocation of the company to a new location.

This is also known as company income insurance.

Business interruption insurance costs between $ 40 and $ 130 per month, according to Insureon.

A guideline for business owners

A company policy (BOP) bundles general liability insurance, commercial property insurance and business interruption insurance. It's an inexpensive way to get small business insurance. Buying the policies separately means higher prices.

How cheap is a BOP? It costs an average of $ 53 per month, according to Insureon.

Companies with 100 employees or fewer and sales of up to approximately $ 5 million are good candidates for a BOP, according to the Insurance Information Institute.

Commercial car insurance

Commercial auto insurance is required for the cars, trucks, and vans used for your small business.
A private car insurance usually excludes any business use of a vehicle. This is why it is so important to have commercial car insurance if you have a company car, truck, or van that you use for business purposes.

If you do not take out public liability insurance for work vehicles, all claims made by you can be rejected. In the end, you would pay for every accident and other damage yourself, which can be very expensive.

Commercial auto insurance costs an average of $ 142 per month, according to Insureon.

The motor vehicle liability insurance for rented and strangers offers liability insurance if employees rent or use their private car for business purposes.

Since all trips you make for business are not covered by personal insurance, it is important to get rented motor liability insurance whenever you rent a car for work or drive your own car for work. This gives you the insurance coverage you need and saves you from having to make high insurance claims if you are to blame for work in a traffic accident.

Cyber ​​liability insurance

Cyber ​​liability insurance helps with the costs of cyber attacks and data breaches. Let's say some private customer information is leaked from your company's database. If the customer complains about your company, cyber liability insurance helps to cover the costs. Cyber ​​liability insurance also helps pay for things like notifying customers who have been affected by a data breach and offering them free credit monitoring.

According to Insureon, the average cost of cyber liability insurance for small businesses is $ 140 per month.

Failure and omission insurance

If your small business provides professional service or advises customers, it is a good candidate for failure and omission insurance.

The error and omission insurance (E&O) covers the costs that arise from mistakes that you make in your work. This insurance is also known as professional liability insurance.

Failure and omission insurance pays out customers who make a claim against your small business. These types of errors include misrepresentation, violation of good faith and fair trade, negligence, and false or inaccurate advice.

It also covers the cost of legal defense, judgments and settlements.

Without E&O insurance, you'll have to reimburse clients out of pocket and pay a lawyer.

What Kinds of Small Businesses Would Benefit From Failure And Injury Insurance? Here some examples:


Advertising agencies

Graphic designer

Interior designers

Management and business consultant

Real estate agent

tax consultant

Technology professionals

Travel agency

The average cost of failure and omission insurance is $ 59 per month, according to Insureon.

Covering technology errors and omissions

If you work in technology, you may be able to purchase an Errors and Omissions Policy specific to your type of job. Technology failure and omission insurance pays legal and other costs arising from customer claims against a small technology company.

The types of small business tech professionals who could benefit from this include:

Computer consultant

Internet provider

IT contractor

Software developer

Website developer

The average cost of insuring against technology errors and omissions is around $ 60 per month, according to Insureon.

Commercial umbrella insurance

The commercial umbrella insurance offers additional protection compared to the other liability insurances of your small business. As soon as you have reached your liability limit of an underlying insurance policy, the commercial umbrella insurance offers additional liability protection.

You can take out a commercial umbrella policy with general liability insurance and commercial auto insurance.

Let's say your company is sued for $ 1.2 million, but you only have $ 500,000 in commercial liability policy. Commercial umbrella insurance would cover the $ 700,000 shortfall.

How much coverage you choose and your company's risk will determine how much you pay for an umbrella policy.

Commercial umbrella insurance costs about $ 40 per month for every $ 1 million of additional coverage, according to Insureon.

Labor compensation insurance

If you only have one employee for your small business, you will need to get workers compensation insurance. Employee compensation pays for work-related illnesses and injuries to your employees and is mandatory in most states. This insurance covers medical care, lost wages and disability benefits for employees.

Small business customers pay an average premium of $ 47 per month for workers' compensation insurance, according to Insureon.

Other types of small business insurance

Here are some additional insurance policies that you might need for a small business.

Directors and Officers (D&O) insurance. This type of liability insurance covers the decisions of the managing directors and board members of a company. If they are sued, the D&O insurance can cover their legal costs. For example, directors and officers could be sued by employees, salespeople, investors or customers for alleged misconduct in running the company.

Inland waterway insurance. Inland waterway insurance covers products, materials and equipment that are transported ashore by truck or rail. It pays for damaged, lost, or stolen property.

Product liability insurance. This type of liability insurance covers claims and lawsuits that a company's products have caused personal injury or property damage. If you are making a product, this is good insurance coverage.

Corporate insurance made easy

Compare free quotes from top insurers at SimplyBusiness. Get a policy in less than 10 minutes.

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