Finding the proper insurance options for your new business can be a long and complicated process. From professional liability to health coverage and even vehicle coverage, there are so many different things to consider in order to ensure that your business is fully covered should anything happen.
- Even Home Businesses Need Coverages
Some business owners who work out of their home might think that they don’t need insurance at all. But that isn’t the case.
Hanley explained in a phone interview with Small Business Trends, “If you run an Etsy store out of your garage and you keep all of your products and supplies out there. Say your house burns down and all of that is gone, your homeowners’ policy isn’t going to cover that.”
- Assess Your Risks
To know what coverage is right for you, whether you’re just looking at different BOP coverage or other plans altogether, you need to know your biggest risks. If your business is one that operates mainly online, then you’ll likely need plans that cover online activities like cyberattacks. But if you sell physical products, you’ll probably want to focus more on products liability.
- Cover Your Employees
If your business has employees, then you definitely need coverage for them. Workers’ compensation requirements vary by state, but you may be forced to have this type of coverage for your employees. And even if it’s not a legal requirement, it may be a good idea depending on the type of work your team members are tasked with.
- Check Your State Requirements
You also need to look into your actual state requirements, since they vary throughout the country. An agent should be able to help. But you need to be sure that you are compliant with all of the legal requirements.
- Consider Disability Coverage
Aside from general workers’ comp, it may be beneficial for you to offer short-term or long-term disability coverage to your team. This may even be required by your state.
- Make Sure You Have Benefits Liability
If you offer any benefits to your employees, such as health coverage, you should also consider a benefits liability policy. If, for instance, you only offer a high deductible health plan with minimal coverage, an employee can potentially take legal action against you if they face a hardship due to a lack of options. Benefits liability ensures that you would be covered in that instance.
- Get Liability Coverage for Your Team
You can also consider adding employment practices liability to your coverage. This would cover any instance of workplace harassment, wrongful termination, discrimination or similar issues.
- And Cover Outside Contractors
When looking into liability policies, it’s a good idea to make sure you get one that also covers independent contractors. You can be found liable for the actions of anyone you hire to do work at your location. So for instance, if you hire a plumber who sexually harasses one of your employees, they can sue you since you’re the one who brought them in.
- Online Businesses, Get Cyber Liability
For online businesses, you may also need liability coverage if you collect any payment or personal information. If you ever get hacked or if there’s a leak of that information, customers may be able to take action against you.
- Cover Your Professional Advice
In addition, if you’re a consultant or offer any sort of advice to people, you may need separate liability coverage that will take care of you in case someone faces hardships due to your advice. This is often called Errors and Omissions coverage.
- Get Coverage for Denial of Service Attacks
You may also need to make sure that your cyber liability or similar policy offers coverage in case of Denial of Service attacks. This may be especially relevant if your business offers any kind of online services or courses. If there’s ever an extended period of time where customers or clients can’t access what they’ve paid for due to such attacks, you could need coverage for those instances.
- Cover Your Products
For more tangible products, you can also purchase products liability coverage. This covers you in case one of your products causes injury or illness. This could be useful if you sell food products, toys or anything that may present any sort of hazard to users.
- Get Business Coverage for Business Vehicles
You also need to make sure that you have specific business coverage for any vehicles used for business purposes. Even if you own a vehicle personally, it needs to be covered under a business policy if you’re going to use it in that capacity.
- Even Uber Drivers May Need Business Coverage
For example, There’s been some confusion in recent years particularly among people who drive for Uber, Lyft or similar companies. Even if you use your personal vehicle and just drive for those companies on occasion, your personal auto policy won’t cover any incident that happens while you’re working as an Uber driver. So you may need a separate policy to make sure you’re covered in those instances.
- Look Into Specific Industry Coverage
The different types of insurance discussed above are really just the tip of the iceberg, according to Hanley. There are several more specific types of coverage that may benefit your business, depending on your industry. So look into the types of coverage that may be most applicable to your business and the type of work you do.
- Do Your Own Research
While it is helpful to seek out a professional to help with your insurance decisions, Hanley also says that business owners should do their own research first. If you know, at least in basic terms, the types of coverage you may need, then you’re more likely to find the best deal and an agent or company that you can trust.
- Shop Around
You also shouldn’t just go with the first agent or company that you come across. Shop around to find the best agent and policies that really work for you.
- Make Sure They’re Reputable
It can also help to ask around or get some references to make sure that your agent of choice is reputable and not just someone who makes a good first impression. In addition, make sure that they have all of the necessary licenses or certifications.
- Evaluate Your Needs Regularly
Once you are satisfied with your coverage, the process isn’t over. You should regularly evaluate your coverage with your agent as your business grows. New employees, locations or even state regulations could impact what types of coverage you need. So stay on top of it and realize that keeping your business insured is a process that won’t ever end.