Why You Need Small Business Insurance

Small Business Insurance

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It is important for small business owners to do everything they possibly can to protect themselves and their business. Obtaining small business insurance gives business owners peace of mind and safeguards their business against many liabilities. Even online businesses can benefit from having some kinds of business insurance. This article will provide a brief overview of the most common and useful types of small business insurance.

Commercial business insurance is not required by law, but having it can protect you against lawsuits, natural disasters or a death of any of the business owners. A lot of small business owners think that choosing to structure their business as a limited liability corporation is the same as having liability insurance. The truth is, no matter how your business is structured, only commercial liability insurance can protect you from business losses. When you are first starting your business, whether it is based in a physical location or completely online, do your research to find out if the local laws in your area require insurance for certain functions conducted through your business. This includes insuring company vehicles or individual employees who do certain tasks.

Some kinds of commercial business insurance are:

• Product Liability: This coverage protects your business against lawsuits and injury claims caused by defective products that your business may produce.
• General Liability: This coverage protects your business against lawsuits caused by general accidents, negligence and injuries.
• Professional Liability: This coverage protects businesses that provide a service from lawsuits caused by malpractice, negligence and other incidents that may occur while providing the service to a customer.
• Home-Based Business: This coverage protects home-based physical or online businesses from various liability and property damage.
• Commercial Property: This coverage protects your company’s physical property from various damage caused by bad weather, fires, vandalism, burglary and more. With this type of insurance, the term property can be used to define the actual building that your business is based out of, computers your business owns, documents, and even lost revenue.

There are a lot of options for business insurance, so you will have to speak with your insurance company to make sure you choose the best coverage for your business.

If your business has employees, there are certain kinds of insurance that you are required to have by law. These kinds of insurance typically include:

• Disability Insurance: Employers in the states of New York, California, New Jersey, Hawaii, Rhode Island and Puerto Rico are required to have disability insurance. Employers in other states can choose to offer this insurance as an employee benefit.
• Unemployment Insurance Tax: All employers in the United States must pay unemployment insurance taxes. The amount varies by state. The first step in obtaining this insurance is registering with the workforce agency in your state.
• Workers Compensation Insurance: Employers are also required to have workers compensation insurance. There are many ways to obtain this type of insurance. You can choose to go with a commercial insurance company, become self-insured or participate in your state’s workers compensation program.

Regardless of whether you run a physical business with employees or a home-based business online, small business insurance is something you need to look into. It not only protects your business, but your future revenue and assets as well.



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