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Insurance: New Business Tips

Starting a new business is a challenge, but finding the right insurance to protect your business shouldn’t have to be. Consider the following tips when shopping for small business insurance:

Business Property Insurance –Watch Those Limits

Small Business Owner Insurance

Before buying property insurance for your new business, make a list of all of your property. Be sure to include property whether or not you think it requires insurance. When you discuss the items on your list with your insurance company, they can help you best determine what needs to be insured and how much insurance you need.

It is not uncommon for businesses to have fluctuating property values. Building and personal property coverage limits must be reviewed frequently and updated accordingly. Many businesses fail to do this –an omission that can lead to a penalty for underinsurance, not an additional issue that your new business wants to address after a claim.

Insurance for Lost Income

A majority of businesses that go bankrupt do so because they lose income after an insured loss and didn’t have business income protection. In addition to insuring your property, be sure to insure the life of your business with a business income policy. For a specified period of time this policy will pay for a loss of net income and continuing expenses while your business is recovering from a covered loss. This policy is a must-have for your new business.

Liability Insurance–Understand Limits and Limitations

General liability coverage will pay for defense costs and damages resulting from claims of bodily injury and/or property damage for which your business is legally liable. Unlike property insurance, there is no set value for liability damage –you never know what the claim will be or how severe the damage. This is why higher limits are always recommended.

Increasing liability limits is not difficult and relatively inexpensive. A few extra dollars invested in premium, can literally increase your liability limits by thousands of dollars. General liability insurance does not cover “Professional Liability” claims. These are claims for which your business is legally liable, but did not cause bodily injury or property damage to a third-party. An example of a professional liability claim would be a CPA’s miscalculation causing financial damages to a client.

Consider the standard of conduct for your type of business. There may be a professional liability policy tailored to your industry that is essential to your business insurance portfolio.

Know the Law

Many requirements for business insurance vary by state law. Before starting a business contact your state’s insurance department for information about which types of coverage are mandatory i.e., worker’s compensation.

Consider a BOP

A business owner’s policy BOP) combines many essential business insurance coverage types under one policy. If eligible, your business will enjoy features through a BOP that are normally purchased individually and usually have higher premiums. Such features include replacement cost, business income and employee dishonesty coverage as well as higher limits of liability.

See how much you could save today on your insurance. Get your free business insurance quotes today!

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