About 40% of small businesses have no insurance. Among those that do have insurance, 75% of them are underinsured.
This creates a huge problem for small businesses because they end up having to pay for property losses and damages out-of-pocket.
If you want to limit the amount of risk in your business, you need to have full insurance coverage. There are different types of insurance policies to ensure your business is able to survive any situation.
What are the types of business insurance you should consider? Keep reading to find out.
1. General Liability Insurance
This is the standard business insurance policy that most business owners have. The issue with this policy is that it doesn’t cover every situation.
Business owners think this is enough, but it only covers physical injuries suffered on your property or from your products.
It covers lawsuits and medical bills that arise from these injuries. It covers libel damages as well.
2. Home-Based Business Insurance
There are more people working from home than ever before. All you need is a laptop and an idea, and you have a home-based business.
You might not have clients visit your home, but your inventory and business equipment need coverage. Your homeowner’s policy doesn’t your business.
You’ll need to get a rider for the home-based business added to your homeowner’s policy. Another option is to have a separate home-based business policy.
3. Business Income Insurance
Millions of businesses had to shut down because of COVID-19. Since they couldn’t operate, they couldn’t generate income.
That turned into billions in losses for small businesses.
There are other situations like floods and natural disasters that could force your business to close. Business income insurance helps your business stay afloat while you can’t operate.
4. Captive Insurance
Captive insurance isn’t necessarily a type of insurance policy. It’s an insurance company that’s owned by your business.
The captive insurance company offers a number of benefits. You can increase your cash flow. The main benefit is that you can customize an insurance policy for your business.
5. Cyber Liability Insurance
Cybersecurity is one of the top concerns for small businesses. It’s also a huge liability if your business suffers an attack.
The best way to limit your risk is to have a cyber liability insurance policy. You can get covered for public relations costs, ID theft monitors, data recovery, and digital security.
6. Product Liability Insurance
This type of policy may get covered in your general liability policy. If you sell products, you need to make sure that you have product liability insurance.
This covers quality assurance issues, packaging errors, and other defects.
The Types of Business Insurance
There are so many types of business insurance policies on the market, that it’s hard to know which ones are the best for you.
The business insurance policies presented in this article give you a general understanding of what’s available. Work with a reputable insurance agent to learn more about your policy options and discover the best ones for you.
For more helpful articles to help you grow your business, check out the blog today!
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