Commercial Insurance for Small Businesses

Small businesses truly are the backbone of the American economy. In 2013, there were about 28 million small businesses in the U.S. It is estimated that 50 percent of the working population, or about 120 million people, work for a small business. Additionally, they are responsible for creating over 65 percent of new jobs since 1995. Starting a small business is a good option for individuals who want to work closely with their clients, obtain results without layers of corporate bureaucracy, and reap the rewards of their hard work. However, they require research, time, and capital; the Small Business Administration estimates that it costs about $30,000 to start a business. In addition to securing a workspace, necessary licenses, and hiring workers, you should also include the cost of commercial insurance policies to protect your investment in your startup budget, and take measures to prevent being sued.

There are a number of different types of commercial insurance policies. The type of business you run will determine the types of policies that will best protect your investment. All businesses should have general liability insurance. If someone is injured by you, your product, your services, or one of your employees, this type of policy will provide you with a defense, and it will pay any damages associated with the alleged loss. Most businesses will benefit from protection offered by property insurance, which insures against the loss of the location, inventory, or equipment. These types of policies may also insure the property of your clients within your control. For example, if you own a watch repair business that burns down, destroying the watches you are repairing, your policy will cover the loss of the watches.

If your business involves transporting employees or equipment in vehicles, obtaining a commercial insurance auto policy is a wise decision. A commercial auto policy protects damage resulting from collisions. It can also cover any damage caused by employees driving their own vehicles for company business. Companies providing professional services should consider professional liability insurance, which is also known as malpractice, or errors and omissions insurance. This type of policy covers lawyers, accountants, notaries, real estate agents, hair salons, and others, for damages associated with improper service.

The sheer number of available policies can be intimidating, and expensive. You may want to inquire about a business policy, which provides a bundle of services at a discounted premium.

Finally, there are a number of steps you can take to help ensure that you do not need to use any of your various policies. Hire a competent attorney to review contracts or advise you on business practices. Incorporating your business will protect your personal assets from seizure, in the event the business is found liable. You should also do your best to protect files, including client information or credit card numbers.