When you open a new business, you’ll need to sort out various types of commercial insurance to prevent financial losses. Some policies you should look into are general liability insurance, workers’ compensation insurance, and business auto insurance. Read on to find out more about these options and whether they apply to your kind of business.
3 Common Types of Commercial Insurance
1. General Liability Insurance
Every year, 40 million lawsuits are filed in the US, many of them against a business. Often, the cost of being sued can exceed six or seven figures, which is enough to bankrupt a small or medium-sized company. General liability insurance is one of the most important kinds of protection. It pays for the plaintiff’s compensation and the legal costs associated with the case.
General liability insurance is crucial for every company that has a physical location visited by clients, such as shops, medical offices, salons, gyms, and leisure centers. However, you should also buy it if you visit customers at their homes since you could damage their property or cause injury. What’s more, companies that advertise need liability insurance because they could accidentally make false claims or cause an offense and are therefore at risk of a lawsuit.
2. Workers’ Compensation Insurance
Even if you try to provide a good work environment to your workers, you might inadvertently put someone at risk or discriminate against them. Experts estimate that over 60% of employees have witnessed or experienced discrimination at work. Whether you employ one or one thousand people, protecting your company against employee lawsuits is crucial.
Workers’ compensation insurance pays for lawsuits filed by your workers, and just like general liability, it covers both the payout and the legal fees. Depending on the type of issue or injury, your employee might ask for money to cover their medical bills, the cost of therapy, and their lost wages. In some cases, they may also receive compensation for their emotional pain.
3. Business Auto Insurance
Car accidents are extremely common. If your employees drive 1,000 miles, there is a 1 in 366 chance that they will get into an accident. While most of these collisions don’t result in severe injury, the vehicles involved might need to be repaired. If you run a business that relies on a company car or a fleet of cars and vans, you should get business auto insurance.
This type of coverage pays out if your car gets damaged or your employee gets injured while driving. Special scenarios, such as a collision with an uninsured motorist, might also be covered, but this depends on the individual policy. To find insurance that suits your business, you should team up with an ISU-ARMAC insurance agent, who can provide you with various quotes.
Insuring your business adequately is crucial because it can prevent financial damage that could ruin the company. Some of the most important policies you should look into are general liability insurance, workers’ compensation insurance, and business auto insurance. If you’re not sure how to get started, speaking to a qualified agent could be a good first step.