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7 Insurance Policies All SBOs Need – OnlineBusinessDegree.org

In your dreams, your small business will thrive and make you millions and nothing will ever go wrong. But in the disappointing land of reality, you can expect for bad things to happen to you and your business every once in a while no matter where you got your business degree: Liberty University, Walden University, Kaplan University, Ashford University, South University, American InterContinental University. To be prepared for these unexpected events, there are several kinds of insurance small-business owners would be smart to have. Look into these seven policies and sleep a little easier at night.

  1. General Liability Insurance:


    Nobody likes a lawsuit, but the larger your business grows, the more likely it is that someone will try to sue you. And for a small business, paying to litigate or even settle a lawsuit can lead to bankruptcy. That’s where general liability insurance comes in handy. This type of policy will cover property damage or bodily injury that occurred because of negligence by you or your employees or because of your products or services. It also usually covers your defense if you’re sued.

  2. Professional Liability Insurance:


    Also called errors and omissions insurance, this type of insurance is important for businesses that provide advice, recommendations, expertise, or other professional services. If you don’t perform the services to the level of expertise expected or don’t perform them at all, you could be sued by clients who claim harm or financial loss. This isn’t covered by general liability insurance, so a professional liability policy will pay for your defense and damages awarded up to the policy’s limit.

  3. Commercial Property Insurance:


    If your property is damaged in an accident or stolen, commercial property insurance pays to have it replaced or repaired. If the item can’t be replaced, some policies will compensate you. This insurance covers you even if your property is damaged away from your place of business. If you’re renting space in a building for your business, you’ll only need to cover your belongings inside the building.

  4. Commercial Auto Insurance:


    If a large part of your business is delivering products or driving around to provide services, commercial auto insurance is a must. Most commercial auto policies provide similar coverage to the insurance you have on your personal car, and they often can add insurance on rented vehicles or employees’ autos that are driven for company purposes. Commercial policies also normally have higher limits than your personal policies, and if you want to insure more than one car, you can consider fleet insurance.

  5. Product Liability Insurance:


    Say you sell a product and someone injures themselves when using it. You could be looking down the barrel of a lawsuit. With product liability insurance, the costs of legal services and damages for bodily injury or property damage caused by a product are covered by the insurance company. Keep in mind that product-related lawsuits can be filed against the businesses that manufactured, assembled, or delivered the products.

  6. Worker’s Compensation:


    If one of your employees is injured or gets sick because of the workplace, you’re going to be glad you have worker’s compensation. Workers basically give up their right to sue you in exchange for wage replacement and medical benefits provided by this policy. Most states require businesses to have this type of policy for their employees, but even if yours doesn’t, you’d be wise to purchase it.

  7. Health Insurance:


    One drawback of owning your own business is that you’re responsible for your own health insurance, as well as that of your employees. The need for your own health insurance is obvious; if you have a medical emergency that you have to pay out of pocket, that loss could affect the money you can put into your business. And though you’re not required to provide health insurance for employees, giving these benefits ensures that you will be able to recruit and keep the best employees who might otherwise go elsewhere. Look into a group health insurance plan and consider how the Affordable Care Act might change your options when it goes into effect fully.

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