According to the most recent statistics, 27 million people in the United States are running their own business. Being a business owner certainly has many advantages, some of which include, being your own boss, making your own schedule, and being able to do something you love. If you are considering becoming a business owner, one of the first things you'll need to think about is purchasing insurance.
Here are three types of insurance policies every business owner should have.
1. Liability
If someone files a claim against your company for bodily injury, liability insurance can provide coverage to pay for legal fees and other unexpected expenses. If you don't have liability insurance, you may end up paying for the legal fees out of your own pocket.
Here are three different types of liability insurance that you should consider getting:
- General liability - covers costs related to property damage, slander, advertising errors, and medical costs
- Professional liability - covers costs and fees in the instance your business is accused of being negligent with services you provided
- Commercial umbrella - additional insurance that further protects your business
Sometimes lawsuits come out of nowhere, which is why it's important to have adequate coverage. Business insurance companies recommend having between $500,000 and $1 million in liability coverage.
2. Property
In the event of a flood, fire, or another type of natural disaster, 40% of businesses have to close temporarily or permanently afterward. This is due to the fact that businesses did not have adequate property insurance and were not able to financially continue after disaster struck.
By having commercial property insurance, you will not have to pay out of pocket for damages incurred to your property in the event of a natural disaster. Besides covering damages to your physical property, commercial property insurance also covers damage to your tools, equipment, documents, and other assets.
3. Worker's Compensation
If you have employees, you will definitely want to ensure they are covered in case they get injured on the job or come down with a work-related illness. Worker's compensation can also provide coverage if a deceased employee's family tries to sue your business.
Adequate coverage depends on a number of factors including:
- The risk of your employees getting injured
- The claim history of your business
- How many employees you have on the payroll
While worker's compensation is required in most states, each of them has its own set of guidelines when it comes to having this type of business insurance. For more information, contact a company like Boone Ritter Insurance.
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