Small Business Liability Insurance

If you are an entrepreneur with your own business, you may be wondering about insurance. It can be difficult to understand the different types and figure out what you need, so we’ve put together this guide to try and help you.

Also Read: Types of Business Insurance

Why do I need small business liability insurance?

Simply put, liability insurance of different types serves as a type of protection for your business, so instead of focusing on what might happen, you can focus on helping your business grow and prosper.

There are many different types of small business insurance policies, but we would suggest that general liability insurance, which we discuss later, is the most important. General liability insurance refers to a policy in case someone is injured or their property is damaged in a way that is related to your business. Although liability insurance is not legally required in some places, it is a sensible option for all small businesses. There are other types of small business insurance that make sense as well, so let’s discuss together.

5 Types of Small Business Liability Insurance

What types of liability insurance are there for small businesses?

The term “liability insurance” can refer to many different types of liability insurance policies, and their names and meanings are not always easy to understand.

You don’t necessarily have to buy every type of small business insurance, but there are several to seriously consider. Here is an overview of the different types of liability coverage:

General and Public Liability Insurance

General liability and public liability are often referred to as the same thing, but they are two different forms of liability insurance .

Liability insurance pays if someone breaks their wrist on the loose carpet in your office or accidentally breaks an ornament while mowing the lawn.

General liability insurance is a package that includes general liability insurance and product liability insurance. It’s a great way to get the most important types of business insurance policies. If you can only afford one type of business insurance, this is the one to get. For most business owners, it’s the ideal type of insurance because it covers you for situations like:

• Repair damage done to property belonging to someone other than you or your employee during your job
• Medical costs for injuries to a third party on your premises or through your job
• If a third party sues you for sharing before and after photos of a site you worked on or a client you helped
• Damage caused by a product you make or sell

Your policy may vary, so while this is a general guide, it is important to check your specific policy for the details of your coverage.

READ MORE: Business Insurance Online

Commercial Liability

Commercial liability insurance may be another way of referring to general liability insurance. Sometimes, however, it means these three types of business insurance coverage:

• Property insurance, which covers damage to your office facilities or equipment.
• Workers’ compensation , which pays your employees’ medical costs if they are injured on the job.
• Public liability insurance

If you’re an electrician, workers’ compensation insurance would pay for medical costs if your employee fell off a ladder at work and sprained his ankle. Commercial property insurance would pay to repair the hardwood floor in his office that was damaged by the ladder when the employee returned, and the price of a new ladder because the old one broke when he fell.

Professional Responsibility

Professional liability insurance becomes relevant if your client is dissatisfied with the work you have done or says you gave bad advice.

For example, if you recommend a certain type of tile that is dangerously slippery, your customer could sue you. If you encourage a personal training client to keep pushing, and they end up tearing their hamstring, that could result in a professional liability claim. Professional liability insurance will generally pay your legal costs and damages to your client.

Workers Liability

Workers’ liability insurance is an important part of workers’ compensation insurance. Workers’ compensation pays for your worker’s medical costs and lost wages if they are injured while on the job. But if your employee feels your worker’s compensation isn’t enough, they could sue you for more damages that wouldn’t be covered by some basic workers’ compensation policies.

For example, if you are a personal trainer and your assistant drops a heavy weight on your foot, workers’ compensation would pay for the cost of treating your broken toe and your lost wages while you recover. But if he sues you too because the dumbbell storage system isn’t good enough, those costs will likely be covered if you have employer liability insurance.

The Importance of Liability Insurance

Many clients want to see that you have liability insurance before they agree to hire you. Liability insurance is not only a way to protect yourself, it also builds confidence and helps you get more work. You can show clients that you are a true professional with insurance behind you, in some cases gaining an edge over your competition.

If we haven’t already convinced you that liability insurance is important, take a moment to think about why your business is important to you. Remember that liability insurance is one more way to protect yourself, your family, and the business you’ve worked hard on. You have invested in your business with your time, your energy and your skills. Liability insurance recognizes that investment and works to help you thrive, confident in what you can do.

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