Small Business Insurance

Small business owners are often confounded by insurance issues. Questions such as what kind of coverage do they need, are there special issues that pertain to small businesses that require coverage, and how to provide coverage to employees typically dominate the thoughts of new small business owners. This article outlines some of the basic insurance considerations that new small business owners must be aware of.

A business owner's policy is the most basic type of insurance required by small businesses. A business owner's policy is a class of small business insurance that protects the small business property from damage caused by fire, theft, and other similar disasters. Business owner's policies also cover some forms of liability if someone is hurt on the small business property.

Service oriented business should purchase professional liability insurance, also known as "errors and omissions" insurance. This class of business insurance provides coverage for damage that may be done when professional duties are performed poorly or neglectfully. This insurance includes medical malpractice. Mechanics need this type of insurance in case they damage someone's vehicle by improperly servicing it, while plumbers and other home contractors need professional liability insurance to protect against damage that may occur if they perform their duties incorrectly. If you are in a skilled trade, it is a good idea to check with your trade association to see what kind of professional liability insurance they recommend.

Many small business owners do not purchase business insurance because they think it is either not necessary or too expensive. Of course, not having business insurance when you need it is a good way to ensure the failure of your company. A single liability case or occurrence of property damage could be enough to doom a small business if it does not have sufficient coverage. Be sure to protect yourself and your business by purchasing small business insurance.