Business Insurance helps companies reduce risks and protect themselves financially against accidents, property damage and other unexpected events that might otherwise lead to financial hardships for themselves and their clients. Business policies may be required by law or contractual agreements between clients.

Dependent upon its size, location and work activities, businesses require different kinds of coverage depending on their size, nature of operations and needs. Examples of coverage for businesses may include commercial property insurance (which could cover buildings and inventory), general liability coverage, business interruption insurance as well as commercial auto coverage.

Liability

Liability insurance safeguards your business against financial loss should an outside party sue over property damage or bodily injury sustained during normal operations. The amount of coverage necessary depends on a variety of factors, including: the industry you work in (construction companies can face greater risks); claims history in your sector; state laws applicable to your industry and company approach for managing risks and avoiding accidents.

Based on your business model, it may also be wise to secure professional liability and errors and omissions insurance in case any services your business provides turn out to be negligent or there are claims filed against it for making mistakes in advice or services provided. These coverages are typically offered together under one package called a Business Owner’s Policy (BOP).

One solution to acquiring individual coverages through various providers is purchasing them individually from various providers, like Next. For instance, Next offers all the policies most small businesses need–from general liability and commercial property coverages to packages tailored for fitness professionals and Amazon sellers–at once, making it simple for small businesses to purchase multiple policies quickly. Furthermore, Next provides digital certificates of insurance which you can present as evidence when asked by clients or landlords.

Property

Business property coverage provides protection for the buildings and equipment owned or rented by your business, such as tools, computers, furniture and inventory. Businesses like beauty/hair salons, florists and printing/hearing aid companies who own costly equipment should consider investing in this form of insurance policy, especially since a fire that destroys these items could put their operations out of commission and require high replacement costs to recover their assets. Add professional liability coverage to your property policy as additional protection should a client sue your company due to mistakes by an employee or product purchased from it, and for perishable goods with spoilage coverage.

Property and liability insurance can be purchased individually, or you could invest in a bundle known as a Business Owner’s Policy (BOP). A BOP bundles both policies into one convenient policy package, potentially costing less than purchasing them separately.

Some business owners choose to have additional coverage, such as workers’ compensation. This insurance provides medical expenses and lost wages to employees injured on the job and should be reviewed according to your state law and/or discussed with an insurance agent. Furthermore, certain industries require additional forms of intellectual property protection that isn’t typically included in standard policies such as trademark and patent registration protections.

Business Interruption

Under-insuring business property may be essential, but having business interruption coverage (also referred to as business income insurance) in place is also critical for keeping operations going after disaster strikes. Business income insurance provides financial recovery of lost revenues and expenses while operating out of temporary locations.

Protection can be added to an existing policy or purchased as an endorsement or rider to a property insurance policy, providing operating losses over an agreed-upon time period (typically 30 days) by covering various expenses such as profits that should have been earned based on prior months, fixed costs such as rent, utilities and payroll; extra expense insurance that covers moving costs associated with temporary operations sites; commissions earned on new business; commissions related to commissioning new customers; training costs related to retraining employees.

Workers’ compensation and terrorism coverage should not be seen as alternatives; rather, it complements each other. We recommend reviewing your specific business needs with a professional insurance agent to make sure you have adequate protection in place. Ultimately, having sufficient cash reserves or access to credit in place can help mitigate financial loss during a business interruption by meeting customer demands while keeping employee wages coming through while the shop remains closed.

Auto

Commercial auto policies provide businesses that rely on vehicles for work with liability and physical damage coverage, along with hired/non-owned coverage for any rented/borrowed cars that your company rents or borrows. Note, however, that business auto coverage typically doesn’t extend to personal vehicles being driven for personal reasons by employees – in such cases you would require personal auto policies as well as employee’s personal auto policies for protection.

When purchasing a business auto policy, your agent can assist in identifying which vehicles and drivers will be used by your organization and helping to select an acceptable policy limit that best meets the needs of your business. Physical damage coverage typically includes collision, specified perils and comprehensive.

If you purchase a business auto policy, your agent can assist in adding coverages such as flood and earthquake insurance as well as more specialized protection such as fidelity bonds and crime insurance. Losses related to employee dishonesty, fraud or theft typically aren’t covered under standard policies and may necessitate purchasing an additional fidelity bond or crime policy. For more information or a quote please speak with your agent or request one online. The coverages outlined here are only intended as general descriptions of available business insurance products and do not alter or overrule any definitions, exclusions or provisions expressly stated within any contract of insurance. For further assistance and to receive personalized details regarding coverages offered as well as tailored quotes contact a State Farm agent today!