Insurance Every Small Business Should Consider

Starting and running a small business takes dedication, hard work, and a willingness to take risks. While you can’t eliminate every risk, you can prepare for the unexpected with the right insurance coverage.

Whether you own a retail store, restaurant, contracting business, office, or home-based business, having the appropriate insurance can help protect your company from financial setbacks that could otherwise threaten your livelihood.

Here are some of the most common types of insurance every small business owner should consider.

General Liability Insurance

General liability insurance is one of the most important coverages for nearly every business.

It may help protect your business if you’re found legally responsible for:

• Bodily injury to a customer or visitor

• Damage to someone else’s property

• Certain personal and advertising injury claims, such as libel or slander, depending on the policy

For example, if a customer slips and falls in your store or you accidentally damage a client’s property while performing work, general liability insurance may help cover eligible legal and settlement costs, subject to your policy’s terms and limits.

Commercial Property Insurance

If your business owns or leases a building, equipment, furniture, inventory, or supplies, commercial property insurance can help protect those assets from covered losses.

Depending on your policy, coverage may apply to damage caused by events such as:

• Fire

• Wind

• Hail

• Theft

• Vandalism

• Certain types of water damage

Review your policy carefully to understand covered causes of loss, exclusions, and limits.

Business Owner’s Policy (BOP)

Many small businesses qualify for a Business Owner’s Policy, commonly called a BOP.

A BOP typically combines:

• General liability insurance

• Commercial property insurance

• Business interruption coverage

Bundling these coverages into one policy is often a cost-effective solution for many eligible small businesses.

Business Interruption Insurance

What would happen if your business had to close temporarily after a covered loss?

Business interruption insurance, often included in a BOP, may help replace lost business income and pay certain ongoing operating expenses while your business recovers from a covered event.

This coverage can be especially valuable following a fire, severe storm, or other covered property loss.

Workers’ Compensation Insurance

If you have employees, your state may require workers’ compensation insurance.

Workers’ compensation generally helps cover:

• Medical expenses for work-related injuries

• Lost wages for eligible injured employees

• Rehabilitation costs

Requirements vary by state, so it’s important to understand the laws where your business operates.

Commercial Auto Insurance

If your business owns, leases, or regularly uses vehicles for work, personal auto insurance may not provide coverage for business-related use in every situation.

Commercial auto insurance can help protect business-owned vehicles by providing coverages such as:

• Liability

• Collision

• Comprehensive

• Medical payments or personal injury protection, where applicable

• Uninsured and underinsured motorist coverage, depending on state requirements and policy selections

Even businesses with just one work vehicle should review whether commercial auto insurance is appropriate.

Professional Liability Insurance

Businesses that provide professional advice or services may want to consider professional liability insurance, sometimes called errors and omissions (E&O) insurance.

This coverage may help protect against claims alleging:

• Negligence

• Errors

• Omissions

• Failure to deliver professional services as expected

Examples include consultants, accountants, engineers, architects, insurance professionals, and many other service-based businesses.

Cyber Liability Insurance

Today’s businesses rely heavily on technology, making cyber threats a growing concern.

Cyber liability insurance may help with certain expenses related to covered cyber incidents, including:

• Data breaches

• Ransomware attacks

• Customer notification costs

• Credit monitoring services

• Data recovery

• Certain legal expenses

Even small businesses can be targets for cybercriminals.

Commercial Umbrella Insurance

Large liability claims can exceed the limits of your primary business insurance policies.

A commercial umbrella policy provides additional liability protection above qualifying underlying policies, helping protect your business from catastrophic claims.

Employment Practices Liability Insurance (EPLI)

As your business grows, employment-related claims become another potential risk.

Employment Practices Liability Insurance may help cover certain claims involving allegations such as:

• Wrongful termination

• Discrimination

• Harassment

• Retaliation

Not every business needs this coverage immediately, but it’s worth discussing as your workforce expands.

Equipment Breakdown Coverage

Modern businesses depend on equipment to operate.

Equipment breakdown coverage may help pay for repairs or replacement of covered equipment damaged by mechanical or electrical breakdown, including:

• HVAC systems

• Refrigeration equipment

• Boilers

• Computers

• Manufacturing equipment

This coverage is different from standard property insurance and can help fill an important gap.

Every Business Is Different

No two businesses face exactly the same risks.

The insurance needs of a contractor will differ from those of a retail store, restaurant, medical office, nonprofit organization, or home-based business.

That’s why a personalized insurance review is so important.

Review Your Coverage Regularly

As your business grows, your insurance should grow with it.

Consider reviewing your policies if you:

• Hire employees

• Purchase new equipment

• Expand your services

• Move to a new location

• Increase inventory

• Buy company vehicles

• Sign larger contracts

Keeping your insurance current helps ensure your protection keeps pace with your business.

Let Us Help Protect Your Business

Running a business comes with enough challenges—you shouldn’t have to navigate insurance alone.

As an independent insurance agency, we work with multiple insurance carriers to help small business owners find coverage that fits their operations, budget, and goals.

Whether you’re launching a new business or reviewing your current policies, we’re here to answer your questions, explain your options, and help you build an insurance program designed to protect everything you’ve worked so hard to achieve.