The 8 Types of Insurance That Every Small Business Owner Needs

The journey to starting your own business is as exciting as it is fraught with worry. Running a business involves some risk that should be considered as there are times when it cannot be avoided. During such a time, it is best to prepare yourself with the cheapest business insurance policy. Alchemy Insurance Agency can help you narrow down the types of policies you need based on your unique business.

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types of business insurance

While you as a business may not find all of these policies beneficial, they should still be reviewed:

  • General liability insurance
  • professional indemnity insurance
  • property insurance
  • business interruption insurance
  • Product Liability Insurance
  • workers compensation
  • Commercial Auto Insurance
  • Cyber ​​Liability Insurance

General liability insurance

As the name of the policy suggests, this type of insurance covers a company against enormous risks ranging from personal injury to property damage. This policy is fundamental to any business because no matter how cautious a business can be, no one is immune to risk.

Specifically, this type of insurance covers some of the following:

  • personal injury or medical bills
    • This only covers the cost of medical bills for those who are not employees but have suffered some type of injury on your property
  • Material damage to third parties and not to the property of the company
  • Personal injury and advertising damage
    • Under this umbrella, it will help recover costs in cases of defamation or defamation, malicious prosecution, wrongful eviction, invasion of privacy or copyright infringement

An accident can happen anytime, anywhere, which means a company needs to be prepared. It’s also best to remember that while this policy covers many contingencies, it’s best to further explore the policies you might use in conjunction with more specific types of coverage.

professional indemnity insurance

Another name for this type of insurance is errors and omissions because it covers a company should one of their advice or services result in financial damage to a client. It is one of the most beneficial insurance policies for businesses that rely on advising clients when there is a likelihood that the client will lose money as a result.

More specifically, this policy goes beyond what is covered in the general liability policy by including:

  • professional negligence
  • Misrepresentation
  • breach of good faith
  • Inaccurate advice

property insurance

Unlike general liability insurance, this policy covers the property of the company holding the policy. Most small businesses own some type of property that needs to be protected, such as a property. B. a commercial building, some supplies or equipment. It is the nature of life that anything unexpected can happen, from a flood to a fire that could cause potentially catastrophic damage.

business interruption insurance

It’s common to worry about property or equipment that could be damaged, but a business must also consider that if they do, not only will they lose property, they will also lose potential money that they could have made during the downtime. Business interruption insurance helps a business recover some of the money it could potentially make until it gets back up and running. For a small business, this could be a make-it-or-break-it.

Product Liability Insurance

A company will always stand by the product it releases to the public; after all, that’s best business practice. However, regardless of the precautions taken, there may be times when a product malfunctions and the company faces a lawsuit. For most companies this could potentially be covered by general liability insurance, but some may not. Product liability insurance helps to cover possible financial damage as a result of a specific product defect, such as medical devices or pharmaceuticals.

workers compensation

Although requirements differ in each state, as a best practice, if a company has employees, it will require workers’ compensation to protect its workers. Some of the costs covered by worker’s compensation insurance include:

  • ambulance
  • medical bills
  • physical therapy
  • loss of wages

This insurance not only helps employees if they are injured on the job, but also acts as a potential deterrent to lawsuits.

Commercial Auto Insurance

Commercial auto insurance helps protect a small business that uses a vehicle for any work-related purposes. Not only does it cover the cost of the car in the event of an accident, but it also helps cover any legal disputes that may arise as a result of such an accident. Most policies can be tailored to the specific needs of the business, but will typically cover costs in collision, collision damage waiver, third party or uninsured motorist cases.

Cyber ​​Liability Insurance

The technological leaps and bounds the world is making have forced us to develop a new type of policy called cyber liability insurance. This insurance helps protect a small business in the event of a data breach or cyber attack.

For example, many businesses need to keep sensitive information within the confines of a computer or the Internet. Hacks are not uncommon, but they can lead to potential disasters. Someone looking for such information will most likely not use it and could end up compromising internal or customer’s files. This insurance covers the costs associated with notifying customers and the cleanup that may be required following such a breach.