You have a lot to manage as a small business owner. But unfortunately, insurance isn’t at the top of your list of priorities. But the truth is, having adequate small business insurance is essential to protecting your business from potential risks.
To help you get a better understanding of the top small business insurance companies, we’ve compiled a list of the top eight frequently asked questions. Please keep reading to learn more about what types of coverage you need, how much it will cost, and how to get started.
1. What types of small business insurance does my company need?
This is one of the most common questions we get asked by small business owners. The answer, unfortunately, isn’t black and white because it depends on factors like the size and industry of your business. However, some basic types of coverage that all small businesses should have include property, liability, and workers’ compensation insurance.
- How much does small business insurance cost?
Again, this depends on many factors, such as the size and industry of your business. However, we can give you a rough estimate based on everyday scenarios. For example, if you’re a home-based business with no employees, you can expect to pay around $500 per year for basic coverage. On the other hand, if you have a storefront with several employees, you can expect to pay closer to $5,000 per year for comprehensive coverage.
- Do I need commercial auto insurance?
If your business involves any vehicle—car, truck, or van—you need commercial auto insurance. This type of coverage protects you financially if your vehicle is involved in an accident.
- Do I need product liability insurance?
Product liability insurance is essential for any business that manufactures or sells products. This type of coverage protects you from being sued if one of your products causes injury or damage to someone.
- Do I need professional liability insurance?
If your business provides professional service, then you need professional liability insurance. This type of coverage protects you from being sued if your work causes injury or damage to someone.
- What is workers’ compensation insurance?
Workers’ compensation insurance is coverage that benefits employees who are injured or who become ill due to their job. In most states, this type of insurance is mandatory for businesses with employees.
- Do I need business interruption insurance?
Business interruption insurance can be a lifesaver if your business is forced to close temporarily due to a covered event, such as a fire or natural disaster. This coverage provides financial assistance to help you cover the costs of operating your business during the interruption.
- Do I need cyber liability insurance?
You need cyber liability insurance if your business stores sensitive data, such as customer credit card information. This coverage protects you from financial losses if your data is breached or stolen.
Conclusion:
Small business insurance is essential to protecting your company from potential risks. But, unfortunately, there’s no one-size-fits-all answer when deciding how much or what types of coverage you need—it all depends on factors like the size and industry of your business.
