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Small Business Insurance

Liability Insurance 101: Types of Small Business Insurance

Small Business Insurance

What separates the regular business owners from the savvy and intelligent ones is the way they manage their risks.

Small business insurance is the difference.   You plan, prepare and grow.  Are you protected too?

Ask any able and sensible business owner about risks and he/she will tell you that risks are part of the business and are unavoidable no matter what kind of preparation you make.  What separates the regular business owners from the savvy and intelligent ones is the way they manage their risks. One way to proactively manage the risks is by having small business insurance (such as a general liability policy) that helps protect businesses in the event that a business-related mistake or accident hams a third-party.

We all know that choosing the right small business insurance is not easy.   Well, you can always ask for business liability insurance quotes from various insurance providers but you have to remember that liability insurance cost is not the only factor you should consider. To further help you in this regards, here are a couple of questions that might help you in determining what your business needs.

Could someone be injured during the course of doing business with you? Can small business insurance protect you?

This is the first and most important question you have to ask yourself as the business owner.  It doesn’t have to be just bodily injury either.  Also, you might say yes to this question but may be undermining your exposure to the risk.  According to studies from the US Chamber of Commerce, one out of three businesses has already faced a lawsuit regarding this and 73 percent claim that they have suffered due to the lawsuit.

What type of harm could your products or services cause?

If you try to think about it, there are businesses where small business insurance coverage is obviously needed while there are those that pose you to ask “why would they need that?” You have to remember that even companies with very limited physical perils will benefit from liability coverage through one or more of the following kinds of policies:

  1. General liability – This policy protects your company from claims stemming from damages done by your company/employees to a third party individual or his/her properties.

  2. Product liability – This type of insurance policy protects against defective products and services that may cause harm.

  3. Professional liability- Also called Errors and Omissions insurance, this kind of insurance provides coverage for unintentional mistakes made by businesses that provide services.

  4. Employment Practices Liability – This type of insurance provides coverage and protection in the event that one of your employees claims unfair treatment or discrimination.

  5. Directors and Officers Liability – This policy specifically protects company directors and officers from lawsuits claiming they have mismanaged the business.

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