Insurance is the cost of doing business – a relatively small cost if you consider that a fire, lawsuit or employee accident could put you out of business if you don’t have adequate coverage. Even if your business is incorporated, your assets could be at risk if you are sued and found personally liable.1
Is business insurance required?
If you have employees, most states require you to have workers’ compensation and unemployment insurance. And depending on where your business is located, you may also be required to have disability insurance.2 Even if you don’t have any employees, having certain other coverages, such as a businessowners policy (BOP), is a good idea. A core BOP includes coverage for general liability, property damage and business income.
How much is business insurance?
As with any insurance, the cost for business insurance depends on a number of factors, such as business type, location, size, annual revenue and years in business. Cost is also determined by which small business coverage options are suitable for your business, as well as coverage limits and deductibles.
Shopping for small business insurance
When it comes to finding the right insurance for your small business, the Insurance Information Institute lists these recommendations:3
- Assess your risk, including all business property, inventory, and equipment.
- Talk to an insurance professional who knows your industry.
- Compare rates, using comparable coverages, exclusions, limits and deductibles.
- Evaluate insurers, making sure they are reputable, licensed and in good enough financial condition to pay claims.
- Keep rates low by implementing a risk management program that minimizes losses from fires, theft, and injuries.
- Review your risks and insurance needs at least annually.