What are the Main Types of Business Insurance Policies?
States today typically require workers’ compensation insurance at a bare minimum. However, business owners should invest in other insurance coverage to ensure they remain protected from losses. What types of insurance policies are available for businesses today?
General Liability Insurance
One type of business insurance every company should have is general liability insurance. This policy covers expenses related to accidents, injuries, and negligence claims. This may include libel, slander, and settlement bonds or judgments required when appealing a legal decision.
Many owners purchase this coverage as part of a business owner’s policy. In the event there is a claim, a person or entity outside of the company serves as the beneficiary.
Professional Liability Insurance
Any business that provides services needs to get professional liability insurance. Also known as errors and omissions insurance, this policy protects the business against negligence, errors, and malpractice in relation to the services provided. Many states require this insurance before they will issue a license to professionals in certain industries.
This insurance pays for any real or perceived injuries or damages sustained by a client of the professional if they choose to sue and win. It covers incidents and events not covered under the general liability insurance policy. In addition, a business owner might choose to purchase additional coverage for industry-specific incidents and events.
Product Liability Insurance
When purchasing commercial insurance in CA, a business owner that manufactures, distributes, or sells products should look into product liability coverage. If a defective product causes a user bodily harm, this portion of an insurance policy protects the business owner from financial loss. Speak with an insurance carrier in Huron, CA to learn how much coverage is needed.
Commercial Property Coverage
Most businesses are housed in a building, which is why commercial property insurance is of importance. This coverage protects the building and any equipment used to run the business. However, it does not cover damage from floods or earthquakes. A separate policy must be purchased for natural disasters such as those.
This type of commercial insurance in CA does cover losses resulting from a fire, hail storm, vandalism, and more. The policy is referred to as an all-risk policy.
A peril-specific policy is needed for floods, earthquakes, and other disasters that are common in the insured area. It’s best to work with an insurance agent to learn which policies are needed for a given area.
Business Income Insurance
Often referred to as business interruption insurance, this policy covers the business owner if the business cannot be operated due to a covered situation. The policy reimburses the owner for any income they lose, rent, employee payroll, and taxes.
In addition, the owner might choose to purchase additional coverage for expenses the business owner anticipates having. This may include temporary workers or extra overtime.
The business owner is the beneficiary of this insurance policy. They receive the funds directly and pay their employees, so the employees are also covered indirectly.
Cyber Liability Insurance
Every business owner today needs to invest in cyber liability insurance as part of their overall insurance program. Cybercriminals continuously work to compromise digital data. If they succeed in this goal, the business could sustain significant damage.
This policy add-on will cover the operational expenses of the business if this happens. In addition, it will also cover any expenses customers incur because their online security was compromised.
This may include PR expenses related to restoring the company’s reputation, expenses associated with improving digital security, and data recovery expenses. The company is the beneficiary of this policy, along with any customers who were impacted.
Commercial Auto Insurance
Any business that operates vehicles as part of operations needs commercial auto insurance. Many business owners believe they are protected if a person is operating their personal vehicle. That isn’t the case.
When an employee of the company is at fault in an accident, the medical bills and damages of all victims will be paid by this policy. In addition, a business owner may choose to add comprehensive and collision coverage.
This coverage pays for any damages to vehicles owned and operated by a company employee. Commercial fleet coverage may also be needed, and certain states have a minimum requirement for this coverage. An experienced agent is of great help in determining what coverage is required.
Contact Academy West Insurance today to learn about additional types of coverage that may benefit a business. This may include commercial umbrella insurance, business identity insurance, and more. Every business needs to be protected from losses, and the right insurance plan provides this protection.
About Academy West Insurance:
An independent, full-service insurance provider, Academy West Insurance works for clients rather than insurance companies. To do so, our agents provide clients with the best service and coverage at a price clients love.