Business insurance covers financial losses that might arise from accidents, natural disasters or being sued. It also protects your company’s assets, income and future.
Most small businesses need general liability, property and business interruption insurance. This can be packaged into a business owner’s policy (BOP). You might need workers’ compensation or commercial auto insurance, too.
No matter the size of a business, it’s at risk of property damage, lawsuits and other disasters. That’s why every company needs insurance.
Business owners should consider general liability, commercial auto and workers’ compensation insurance. Some industries may require industry-specific policies to cover incidents more common in their line of work.
Property insurance covers a business’ buildings, equipment and inventory against theft, vandalism, natural disasters and other hazards. It’s often combined with liability insurance in a package called a business owner’s policy (BOP).
Liability insurance protects a company in the event of a lawsuit brought by a third party. This can include things like bodily injury, property damage and personal and advertising injury. Workers’ compensation insurance helps pay for medical care and lost wages for employees who are injured on the job. Many states require companies to carry this coverage for their employees. Fidelity bonds are another type of insurance that protects a business from financial loss due to employee dishonesty.
Liability insurance is a must for any company. It protects against damages resulting from accidents, property damage and professional mistakes. A business insurance agent can help you determine which coverages will best suit your needs.
Many small businesses need commercial auto insurance to cover vehicles used in the course of business. Most states require employers to carry workers’ compensation insurance for workplace injury liabilities. Insurance companies offer a variety of policy options including commercial property, general liability and business interruption insurance. A popular choice is the Business Owner’s Policy (BOP) which bundles property, liability and business interruption insurance into one package.
A small business with employees may also need employment practices liability insurance to protect against claims of discrimination, sexual harassment, wrongful termination and negligent employee evaluations. Other specialized business insurance policies are available to address risks specific to a certain industry such as liquor liability for restaurants or directors and officers insurance for larger companies.
Business Interruption Insurance
During the COVID-19 pandemic, business interruption insurance has been a hot topic of conversation among business owners. While this type of coverage typically is not available as a stand-alone policy, it can be added to commercial multi-peril property or business owner’s policies.
Business interruption coverage compensates for the loss of income your business would have made had it not been forced to close due to physical damage to your premises. This can include lost commissions, rent or mortgage payments that are still owed, loan repayments, taxes that must be paid, and additional expenses such as renting temporary space and equipment, paying non-exempt staff overtime and advertising to let customers know you are temporarily closed.
Generally, your business interruption insurance will only be triggered by direct physical damage caused by a covered peril. The majority of policies the LDI team has reviewed exclude losses caused by viruses. If you want to include this coverage, it is important to discuss the specific language in your policy with your broker.
Employee Dishonesty Insurance
Employee dishonesty insurance, also known as a fidelity bond, is part of a commercial crime policy and reimburses businesses for losses caused by current or past employees that engage in dishonest behavior like theft, fraud, forgery, embezzlement and other internal exposures. It can be purchased per loss, or per employee and sometimes extends to trustees, partners, directors, seasonal workers and volunteers.
Examples of covered claims include credit card fraud (where an employee purchases items with a company credit card and then submits the receipt to the business for reimbursement), cash and inventory theft, and payments made to fictitious vendors. A third party endorsement can be added to an employee dishonesty policy that extends coverage on the premises of clients for whom the business has a written contract to perform services.
It is important to note that this type of insurance doesn’t protect against theft committed by your clients or customers and requires you to maintain a separate fiduciary liability policy to do so. assurance pro