Simple Guide to Small Business Insurance

Are you small business owner ?
Here are simple guide to insurance your small business :

Legally Mandatory

Workers’ Compensation Insurance

Also known as employer’s liability insurance, this insurance is mandatory in every state. By providing workers’ compensation insurance, your company can award employees monetary sums in the event that an employee is injured or disabled while on the job. Since coverage is provided in exchange for the employee’s right to take legal action against the company, you will be protected from lawsuits in the case of employee injury or death.

Business Auto Insurance

If your company owns vehicles, then all 50 states require you to carry business auto insurance. The extent of coverage will depend on who drives the vehicles and what your state requires.

Disability Insurance

If your business operates in the states of California, Hawaii, New Jersey, New York or Rhode Island, you are required to carry disability insurance. Disability insurance replaces a percentage of income for employees or business owners should they be injured and unable to earn a living themselves.

Not Legally Mandatory, But Must-Haves Nonetheless:

Property and Liability Insurance

Property and liability insurance protects your business’ assets from disasters such as fire and theft. Though you are not required to have it by law, you may own valuable assets such as furniture and expensive equipment that you cannot afford to lose. When purchasing this insurance, ensure that you are covered for the “replacement value” of these assets.

Errors and Omissions Insurance

We’re all human, and we all make mistakes. E&O insurance covers you when a client holds your company responsible for mistakes or errors made by your firm that were damaging to the client. Since OfficeDrop handles valuable customer documents, we decided to carry this insurance in case customer documents are accidentally lost or damaged. Every one of our customers is protected up to $1 million if they are adversely affected by an error.  Consulting and other professional service firms are also good candidates for this insurance.

Criminal Liability

While E&O insurance protects against unintentional errors and damage, criminal liability insurance covers damages intentionally done by employees. Even with extensive background checks of each of our employees, criminal acts are sometimes completely unpredictable, so we chose to carry criminal liability.

Business Owner’s Insurance

Recommended for any business owner, business owner’s insurance protects you from personal liability in the case of litigation against your business.

Other Options

Besides the above mentioned, there are many other insurance options that may greatly reduce risk in your business. Other policies include:

• Business Continuation Insurance
• Product Liability Insurance
• Key Executive Insurance

Though not all companies carry these insurance policies, they are still worth considering.
Still not sure as to what insurances to get for your business? While you may not need all of the insurance policies not mandated by law, we highly recommended that you review your business with an insurance advisor to discuss which insurance options are best for you.

Reference : http://smallbiztrends.com/2010/07/a-simple-guide-to-small-business-insurance.html