Small Business Brief


Cover Your Assets: A Look Into the Best Insurance Policies for Your Small Business

Your business is your baby. You worked incredibly hard to build it, care for it, and raise it.

It would be devastating to lose it to a lawsuit or damages that weren’t covered by insurance. It doesn’t take much these days since there are millions of lawsuits filed each year.

What is the best small business insurance? It really depends on your business. Every business is unique, which requires a highly tailored policy.

You may think that insurance is an unnecessary expense because you have a side business that doesn’t generate that much income. That can cost you more in the long run because you could lose your personal assets without insurance protection.

Insurance is a necessary cost of doing business, whether your business is large or a side gig. Read on to find out the different types of business insurance and how to find the policy that’s right for you.

Home-Based Business Insurance

For those of you who work from home, you want to make sure that your business is covered. You may feel happy and secure about the future, but you know that it just takes one moment to through everything into flux.

You should know that your homeowner’s policy is unlikely to cover your home-based business. Things like inventory and equipment for your business won’t be covered since they’re considered separate from your personal property.

If you have clients that meet you at your home, you want to make sure that you have coverage for things like trips and falls.

Start the conversation with your homeowner’s insurance company to see if you can get a home-based business rider.

Business Owners Policy

As a business owner, you want to make sure that you’re covered for multiple situations. A business owner’s policy combines multiple types of policies under one business insurance policy.

This is often the best business small business insurance policy because it covers crime, property, liability, business interruption, and vehicle. This is also a flexible policy that can be adjusted to fit your specific needs.

Worker’s Comp Insurance

If you’re just starting your business, this probably isn’t a major concern. However, when you’re getting ready to hire employees, this is a must.

You may be required to carry worker’s comp insurance, depending on how many employees you have and the location of your business.

Worker’s comp will insure your business for instances where employees are hurt on the job. That could be through performing regular duties or a simple slip and fall injury.

Professional Liability Insurance

This is often the best small business to protect you in the event of a lawsuit. For service providers, you’ll be covered if you didn’t perform your contractual duties or harmed a client in some form.

Professional liability insurance is often referred to as Errors & Omissions, or E & O insurance.

Life Insurance Policy

Did you know that you can turn your insurance policy into a tax strategy? When you utilize a life insurance policy like a restricted property trust, you can leverage that into a corporate tax deduction.

Cyber Security Insurance

Did you know that small businesses are incredibly susceptible to data breaches and hacking attacks?

These sorts of things are just for large businesses to worry about. On top of that, small businesses who get hit with an attack are likely to shut down within six months.

It just takes on click on an email for a wave of chaos to be unleashed on your business. You could fall victim to ransomware, or you could not even know that your systems are infected with malware.

There’s more than lost productivity at stake. Public trust and business opportunities are lost when you have a hacking attack.

If you have any type of e-commerce business or your business handles sensitive data like credit cards, you need to have cybersecurity insurance. This will cover your business for costs related to public relations, liability, and other legal costs.

Business Auto Insurance

Businesses that rely on cars for deliveries or other business-related activities need to consider auto insurance.

The policies required will vary, depending on your location. What you should know is that if your business owns cars, they need to be insured.

If your employees drive their own cars for business, they should be covered under their own policies.

Business Interruption Insurance

As a business owner, there’s only so much that you can control. One thing that you can’t control is the weather and natural disasters.

What you can be assured of is that these are becoming more and more likely due to climate change.

When your business is forced to close because of a natural disaster like fire or floods, your business will lose a significant amount of income.

Business interruption insurance is the best small business insurance to cover these instances, but you want to make sure that you have adequate coverage.

Key Person Insurance

Do you have a right-hand man or woman that you rely on to run the business? This could be a business partner, an employee, or the owner of the business.

Key person insurance will cover you if you have a person that you rely on and they can no longer work.

Commercial Property Insurance

For small businesses that have an office space they lease or own, you need to protect your property in the event of fire or theft.

That will cover furniture, inventory, equipment, and business signs. You’ll want to check with your insurance company to see if floods and other natural disasters are covered.

Getting the Right Policies for Your Business

How can you ensure that you ‘re getting the right insurance policies for your business? It really comes down to the company you work with.

You may be tempted to work with a company solely because you know an insurance rep at that company. That kind of loyalty could cost you in the long run. Insurance sales have a reputation for high turnover rates.

That personal relationship that you have with your rep could go out the window, so you better make sure that your rep will stick around and you have a company that works for you.

Claims Processing

One of the main reasons why you pay for insurance is to make sure that your business is covered in case of an emergency or event.

You don’t want to be in a position where you pay for insurance only to find that they won’t process your claim or that it takes forever. Meanwhile, your business is suffering.

You want to know and understand the entire claims process beyond “just call this number, and they’ll take care of you.”

You want to know the details, such as how long it will take for a claims adjuster come to your site, how long does it take to process a claim, and in some instances, what additional information is required.

For example, in the case of a cyber attack, would your insurance agency require a police report to process a claim? These are the details that you need to make clear before you sign up.

Costs & Discounts vs. Level of Service

You know the saying that you get what you pay for. With insurance, that can be true, too. The best business insurance isn’t necessarily the cheapest. Business owners are accustomed to looking only at the bottom line when it comes to insurance.

This bottom line mentality can come at the cost of your business. You have to step back from the cost of insurance and look at the big picture. You have to weigh the level of coverage, the personalized service you can get, and the premium of the insurance.

You don’t want to try to save a few bucks every month and then find yourself underinsured. You can always ask for discounts, like bundling insurance discounts.

Review Your Coverage Every Year

Your business is likely to undergo many changes over time. You could hire new employees, decide to shift sales online, get international customers, or add new cars to your fleet.

All of these changes would result in a major shift in your insurance policy. You may find that your business isn’t covered in some instances.

That’s a major reason to have an annual review with your insurance company.

The Best Small Business Insurance for Your Business

What’s the best small business insurance for your business? It depends on your business. There’s no such thing as a one-size-fits-all insurance policy.

It depends on your industry, your location, your type of business, the number of employees, and many more variables.

You want to understand the different types of insurance for small business and business owners to make sure your business is protected in any possibility. You worked very hard for your business and to bring it to where it is today.

Doesn’t it make sense to make sure you have adequate insurance coverage? When you’re shopping for insurance, make sure that you look at the big picture, not just the bottom line. That will help you make sure that you’re covered.

Do you want more business tips? Browse the rest of our business articles to find out how to be a raging success in the business world.