Growth can bring changes to the size and nature of any business, but a certain amount of risk will always remain. With it comes a range of unforeseen circumstances that can result in severe damages or even closure. A single data breach, accident or lawsuit is often all it takes to wipe out an organization for good.
If you’d rather avoid an untimely demise, investing in business insurance is a must. Unfortunately, there’s no one-size-fits-all solution here. Policies are typically designed to provide coverage against a particular risk. Following is a primer on six essential types of business insurance that will help you identify those you need most.
Workers’ Compensation Insurance
Workers’ compensation insurance covers medical expenses and a portion of an employee’s income if they’re injured or fall sick on the job. Not only is it mandatory in most states, but this type of insurance is important even for low-risk environments. It only takes a medical condition like repetitive strain injury for your office worker to make a costly claim.
General Liability Insurance
Perhaps the closest you can get to a comprehensive policy, general liability insurance protects your business from a myriad of claims. General liability insurance includes, but is not limited to bodily injury, property damage, reputational harm, copyright infringement, and medical costs resulting from injuries sustained by customers on your premises.
After analyzing five years of claims, The Hartford found that 40 percent of small businesses are likely to face a general liability claim in the next decade. Be sure to check out the provider’s in-depth guide on general liability insurance to learn more about why your business needs it and what it will cost.
Professional Liability Insurance
Also called errors and omissions insurance, professional liability insurance provides coverage against allegations claiming negligence with regards to your work. It namely stems from unsatisfactory performance or mistakes. This insurance type is especially important for service-based businesses but can be useful in certain other industries as well.
This is a must for any business that rents or owns a physical space. Property insurance covers the cost of equipment, inventory, furniture and other assets lost during a natural disaster, fire or robbery. You’ll need to consider the specific risks associated with your area to identify the most suitable property insurance policy for your business.
Life or key executive insurance is useful for two reasons. First, it can prove helpful when attracting top talent. Additionally, the latter type of policy can cover the losses incurred when a key employee is no longer around to do their job.
Cyber Liability Insurance
Now more than ever, businesses need to be aware of the risks that come with being connected to the internet. A cyberattack can happen at any moment, often causing irreparable damage to a company’s finances or reputation. Cyber liability insurance protects your company from the costs associated with data breaches or the defacing of a website.
Don’t wait until you’ve been sorry too many times not to be safe. Take out the necessary policies for peace of mind knowing your business is protected against unexpected dangers.