Small business insurance, also called commercial insurance, can provide you peace of mind knowing that your investment is protected. You worked hard to reach your goal of being a successful business owner, and choosing the right insurance is essential to that success.
Why Do You Need Small Business Insurance?
As a business owner, you could be held responsible for any financial claims against your company if you don’t have the right insurance. Different types of coverage are available to protect your business against various perils. Selecting the right type of insurance is essential to ensure that your business is adequately covered.
The types of small business insurance listed below will help you decide which is right for your business.
What Are the Different Types of Business Owners Insurance?
Depending on where your business is located, some types of business owners insurance are required by law. Other types come highly recommended. The best way to make an informed decision is to talk with a trusted insurance agent. Their expertise will be a valuable resource when making your final decision.
The type of small business insurance you need depends on several factors such as:
- Location of your business
- Your trade
- Number of employees
- Estimated annual revenue
- Types of services you provide
- Whether you operate from a home office or a separate address
Considering these factors, you may need more than one of the available options.
The Most Common Types of Commercial Insurance
Like many small business owners, you may not have the capital or resources to pay out-of-pocket for large claims. That’s why commercial insurance is a great investment.
These are the most common types of insurance options available for small businesses:
- General Liability Insurance – Protects your business from bodily injury or property damage claims that result from your company or the products you sell.
- Professional Liability Insurance – Helps cover claims or lawsuits resulting from mistakes in the professional services your company provides. This coverage is also known as errors and omissions (E&O) insurance.
- Business Income Coverage – Also known as business interruption insurance, this coverage helps replace lost income in the event of a covered peril that prevents your business from operating.
- Commercial Property Insurance – Protects any rented or owned equipment or buildings used in day-to-day operation. This insurance helps cover replacement costs.
- Workers’ Compensation Insurance – Provides benefits to employees for work-related injury or illness. Most states require this insurance if you have employees.
- Commercial Auto Insurance – Covers property damage and bodily injury claims if an employee is involved in an accident while driving your company vehicle.
- Data Breach Insurance – Also known as cyber liability insurance, this coverage helps your business respond in the event any personally identifiable information is stolen or lost. The costs involved in handling this type of situation can be significant, which is why insurance is an important consideration.
- Commercial Umbrella Insurance – Covers the difference between your policy’s limits and any claims that exceed those limits.
- Employment Practices Liability Insurance – Proctects your business from claims filed by employees for discrimination, sexual harassment, or wrongful termination.
- Business Owner’s Policy (BOP) – As the most popular type of small business insurance, a BOP combines general liability, commercial property, and business income insurance.
- Hazard Insurance – Also known as commercial property insurance, this type of coverage protects your owned or rented property, including building and equipment.
Most insurance providers allow you to customize your policy to ensure the best coverage.
How Much Does Small Business Insurance Cost?
The costs for commercial or small business insurance vary between companies. Each company uses different factors to determine the cost and each business needs different coverages. If you’re wondering how much you will have to pay, here are some average costs:
- Business Owner’s Policy (BOP) – $3,125 yearly; $260 monthly
- General Liability Insurance (GLI) – $360 yearly; $30 monthly
- Workers’ Compensation – $840 yearly; $70 monthly
Many factors can affect the cost of your small business insurance, so these average costs may not apply in your situation. Some of the things that will affect the cost are the type of industry, the number of employees, payroll, the potential for claims, and claims history.
Finding the Right Business Insurance for Your Needs
To get an idea of how much your commercial insurance will cost, get several quotes from different companies and compare the costs and the coverage provided. If you’re not sure which insurance companies provide the most trustworthy information, talk to your local agent.
If you live in or near Cheraw, SC, Sandifer Insurance Agency is the most trusted local agency according to hundreds of satisfied customers. Contact us today to get a free quote for your small business insurance. We have over 40 years of experience in helping customers get the right insurance for their needs.
Choosing insurance can be stressful, but our skilled, knowledgeable agents can help. Reach out to us by phone, email, or online today.