Did you know that 75% of businesses in the US are underinsured by at least 40%? If you don’t have the right types of business insurance, you’re putting the future of your business at risk.
Many people don’t understand how different business insurance is from personal insurance and don’t realize the types of business insurance they actually need.
If you have questions about business insurance, it’s essential to know about the available types of insurance, so you can see where you stand.
Keep reading to learn about four different business insurance types you need to protect your business!
1. General Liability Insurance
During your daily business operations, anybody visiting your business could decide to file a claim regarding something that happens on your property.
General liability insurance is an essential type of business coverage that protects you from claims and lawsuits that anyone might file outside of your company.
The types of claims general liability insurance will protect you from include things like:
- Bodily injury
- Property damage
- Any medical expenses
- Libel and slander
- Cost of defending or appealing lawsuits
2. Commercial Property Insurance
Commercial property insurance covers loss and damage to company property from events like wind, hail storms, fire, smoke, and vandalism.
Insurance companies typically define property as buildings, business equipment, computers, and company files. You’ll need to read your property insurance policy carefully, as these policies usually don’t cover property losses from:
- Burglary
- Cybercrime
- Employee theft
- Damage to any business vehicles.
Also, if you live in a high-risk area, you’ll need to purchase additional insurance to cover flood and earthquake damage.
3. Cyber Liability Insurance
Cyber liability insurance protects your business from financial losses if your digital data is compromised. Issues like data breaches and system hacking can cause you to lose data, and you’ll also have to deal with the costs of securing customer information.
Usually, cyber liability coverage includes:
- An investigation of the incident
- A risk assessment to prevent future cyber incidents
- Any loss of revenue
- Costs of notifying customers
- Costs for anti-fraud services for your customers like credit monitoring
Some policies will also cover the cost of repairing any systems damaged during the cyber incident. You can check out this link to learn more about cyber liability insurance and see some of the top cyber security threats your business faces today.
4. Product Liability Insurance
You’ll need product liability insurance if your business sells, distributes, or manufactures products.
Product liability insurance protects you against financial losses due to product defects that cause injury or any bodily harm. It also protects you against problems that result from labeling or product instructions.
The amount of insurance you need to buy depends on the type of business you have. For example, if you have a clothing business, you’ll need less coverage than someone who sells food or toys.
Product liability doesn’t cover product recall costs or losses in inventory, so it’s important to read the policy carefully to know what you’re paying for.
Make Sure You Have the Right Types of Business Insurance
Now that you know more about the types of business insurance available, you can adequately protect your business and assets for years to come.
Remember to do your research to learn more about what these policies cover and what other insurance you might need.
For more business tips, check out the rest of our business articles for more inspiration!
