Understanding the Different Types of Business Insurance Coverage
Most states require businesses to have general liability insurance. But did you know you can have more? Learn the different types of business insurance coverage through this guide. You’ll also discover that you can bundle these coverage types to fit your business needs.
General Liability Insurance
Business owners may get this business insurance type if they wish to cover some lawsuits and other legal troubles caused by negligence claims, accidents, and injuries. General liability insurance protects against property damage, libel, slander, medical expenses, and other settlements needed during trials.
Commercial Property Insurance
Commercial property insurance is a type of insurance that protects your rented or owned building when running a business. But this insurance does not cover any damage caused by natural disasters, such as storms and earthquakes. It would help if you had a separate insurance policy to help your business with specific claims, such as commercial flood insurance.
Workers’ Compensation Insurance
Another type of insurance to consider is workers’ compensation insurance, which covers lost wages and medical expenses in case an employee gets in an accident while working.
This type of insurance is also known as “workers’ comp,” which sometimes also covers the cost of your legal defense. Workers’ comp is mandatory in all states except Texas.
Professional Liability Insurance
Professional liability insurance differs from general liability insurance in that it covers lawsuits instead of bodily injury or property damage to someone else. This insurance type covers lawsuits claiming you made an error in the type of service you offered. Other insurance providers and businesses call professional liability insurance an error and omission insurance.
Data breach Insurance
Whether big or small, businesses always keep confidential information about themselves and their clients or customers. Hence, it is essential to protect their data from hackers through data breach insurance.
For example, if your computer obtains a virus that got personal information, this policy will immediately notify your customers and employees while hiring a public relations firm. The insurance company may also provide services related to credit monitoring to help victims whose data have been compromised.
Business Owner’s Policy
A business owner’s policy is a business insurance type that includes a set or bundle of diverse coverage types. For instance, you can get a business owner’s policy that contains general liability, data breach, and workers’ compensation insurance.
When choosing a business owner’s policy, it’s essential to be strategic and targeted. For instance, if you own a soda shop, some common threats you might encounter include cash register theft. If this happens, your business owner’s policy can help you reimburse lost business costs.
Product Liability Insurance
This insurance type protects you from customers’ negative claims about your product. For example, if your product caused damage to property or injury, this insurance will cover your defense cost.
Commercial Auto Insurance
Do you have a vehicle registered in your business? Commercial auto insurance will shield you from medical costs, repairs, and replacements caused by accidents. Lost wages can also be covered if you have commercial auto insurance.
