What insurance will I need to start a new business?
Perhaps the best way to answer that question is with a series of questions & recommendations:
Besides any legal or contractual requirements, what exposures will you or your business have? In other words, what are the various events that could occur that could cause a financial loss? Once you identify them and ideally prioritize them, you can determine which exposures you’ll insure and which ones you’ll take a risk by not insuring.To begin, it’s important to understand a couple of terms that will be very important as you identify what insurance coverage you’ll need (exposure & risk).
Here are some common Coverages to consider:
Do you own or lease a physical location for your business? Then you’ll need Property coverage. If you also want coverage for contents in the building, you’ll need Business Personal Property coverage.
If you have property such as: specialized tools or equipment, merchandise being delivered by truck, valuable papers, accounts receivables, neon signs or customer’s property in your care, custody or control, it will fall under the coverage category of Inland Marine.
Almost every business owner will want to protect their business from the possibility of causing harm to any person arising out of the conduct of their business operations, products or services. General Liability is the type of insurance needed to cover these types of concerns.
Will there be any vehicles owned by the business or will employees be using their personal vehicles for business use? If so, then you’ll need one of the various combinations of Business Auto coverage.
Will you have any employees? Then you will need Workers Compensation and Employer’s Liability coverage, as it’s required by law in all 50 states. This will provide medical coverage and indemnity for disability as a result of injuries on the job. As an Owner or Officer of the business, you’ll have the choice of participation.
If you are interested in purchasing higher limits in excess of the limits on your primary policies, particularly as it relates to General Liability, Auto Liability and Employer’s Liability, you can purchase an Umbrella with limits starting at a Million.
These are only some of the more common coverages that may be needed for a new business but certainly not all, which is why you should consult with an Insurance Professional to make sure your new business is fully protected.