Insurance Overview – Business Insurance
The term business insurance is generally used for any type of commercial business policy. Business insurance is designed to cover perils and hazards that are not covered by a personal policy, such as auto or homeowners insurance policy. There are different types of Business insurance, and policies can be written as a single line of business, or they can be combined for a Commercial Package Policy or written as a Businessowners Policy, known as a BOP.
The type of insurance coverage you need depends on your business operations and what your exposure is. Business Insurance policies can be broken down by policy type and are outlined briefly below.
Property insurance provides coverage for your building, property, property of others, inventory, or income. Building coverage is for the structure itself, but it also includes any permanently installed equipment and machinery, such as air conditioning/heating units, furnaces or a boiler. Property that is attached to the building such as cabinets, are known as fixtures and are considered to also be part of the building.
Property that is owned by you but not considered Building insurance is covered as Business Personal Property. Business Personal Property is inventory, furniture, equipment, computers, machinery, finished goods, goods-in-process and raw materials. Also covered is property that you have leased and are contractually obligated to provide insurance on any property that is in your care and located on premises. Improvements and betterments that you make to a building that you lease that cannot be removed legally are also considered as BPP.
Business Income covers your loss of income due to a covered loss. For example, if you need to close to make repairs after a covered loss or if a critical piece of equipment is damaged and there is a related loss of income and Business Income covers this.
For businesses that transport equipment during the course of business, such a contractor equipment, or sound or camera equipment, would need to purchase Inland Marine Insurance. Anybody in the trucking business, or who transports cargo would also need this coverage.
Liability insurance protects your business from lawsuits brought against it by clients, customers, associates and other third parties. Lawsuits are expensive to defend and settlements and judgments are an additional cost. Without insurance, businesses will have to pay out of pocket. Every business should have liability coverage to protect their business.
Liability insurance includes coverage for:
· Bodily Injury and Property Damage Liability which includes:
o Premises Liability – coverage for injury or damage that happens on your premises due to your negligence
o Operations Liability – coverage for injury or damage due to your operations that are away from your premises
o Product Liability – coverage for third-party claims for defective products that you either sold or made
o Contractual Liability – covers assumed liability from a contract
o Completed Work Liability – coverage for injury or damage arising from work that you completed that is deemed defective
· Personal and Advertising Injury Liability relates to injuries that are financial and include false arrest, slander and libel and for injuries committed while advertising your business.
· Medical Payments will cover injuries to somebody injured on your premises or at a job site that is away from your premises.
Any business that has employees must have Workers Compensation insurance. Workers Compensation covers your employees for injuries sustained on the job. Workers Compensation will pay medical coverage, disability, rehabilitation and death benefits for employees.
Personal auto will not cover your commercial auto exposure. A commercial auto policy will cover your owned vehicles, leased vehicles, and rented vehicles. Hired and non-owned auto coverage is an important part of a commercial auto policy and includes coverage for cars that are rented, borrowed or owned by employees of the company. For example, an employee running an errand for the company who is involved in an accident would be covered under hired and non-owned auto.
Umbrella and Excess Liability
These policies provide additional liability limits to underlying policies. It typically will apply as coverage that is over and above those of the underlying policies, such as General Liability or auto.
For businesses who provide a professional service, Professional Liability, also known as Errors and Omissions coverage, provides liability coverage for claims stemming from your failure to provide services as expected or negligent acts. Doctors, computer consultants, architects, lawyers, consultants and anybody else who provides professional services should have Professional Liability coverage.
Ensuring that you have adequate insurance is necessary in order to keep your business protected. We understand that no two businesses are alike and do not approach insurance from a one-size-fits-all perspective. We work with our carriers to tailor insurance coverage to the specific needs of our clients, so they have the coverage that they need at affordable rates with A rated carriers. If you would like to have one of our agents contact you about going over your insurance needs, please call us at 855-266-2135.