Business Insurance

Business insurance coverage is there to protect businesses (and their owners) from the high financial risk and loss that can occur during typical business operations. There are several kinds of insurance policies offered to businesses, some of which are required by law, including: property insurance, legal liability insurance, employee compensation plans, and business interruption insurance.

Business owners have to evaluate their own circumstances, such as the size of the company and the kind of work being done, to determine potential risks and ultimately decide which coverage and how much makes the most sense for them.

What Are the Different Types of Business Insurance?

There are several kinds of business insurance that companies of all sizes should consider. The most popular policies include:

• Property insurance. Property insurance plans protect a business’ equipment, inventory, furniture, and signage against loss, damage, or theft. Not all disasters are covered, however. Business owners would need separate covered for events, such as floods, earthquakes, or tornadoes.
• Legal liability insurance. In general, liability insurance policies provide a financial cushion against any legal claims made against a business. There are many different types of liability insurance plans. The most common include coverage for business mistakes or negligence that causes injury or property damage to a customer or another individual not working for the company.
• Workers’ compensation policies. Workers’ compensation insurance offers wages and medical benefits to employees who were injured or who became sick while on the job. A side benefit to this form of insurance is that employees who accept compensation are then legally unable to sue the business for negligence.
• Business interruption insurance. As the name implies, business interruption insurance offers coverage against the income that is lost when there is a major disruption to business operations, for example, in the event of extensive damage due to a fire, storm, or theft. It also offers coverage for continue fixed expenses as well as any expenses incurred while operating from a temporary location.