Starting your own business means taking on some degree of risk. As a business owner, you already have the passion and drive to take on new challenges, but you’ll also need to protect the value of the assets you purchase for your company. Insurance can help you recover when things go wrong. From property losses related to items such as fire or theft, to liability issues should someone sue or threaten to. With the proper policies in place, you’ll gain peace of mind and feel more comfortable in your role as an entrepreneur.
FREQUENTLY ASKED QUESTIONS
The cost of insurance is based on a range of factors including the following:
- The value of the company assets you wish to insure.
- Number of employees.
- Specific risks associated with your industry.
- Your personal risk tolerance and the amount of liability protection you prefer.
Yes, you should include insurance expenses in your initial business plan and yearly budget. From a cash flow perspective, you’ll want to understand what kind of payment options and timing are available. When starting out, aim to separate your company assets from your personal items to determine the amount of insurance you’ll need to carry. To properly establish your new company, speak to a tax or legal advisor about formalizing the structure of your business.
After you do research and talk to friends or peers, your easiest starting point is your current agent Or, contact an insurance company that offers specialized business coverage. To find out more about coverage options and the costs of business insurance, request a quote.
Many new business owners opt for a business owners policy (BOP). This policy includes coverage designed specifically for small businesses.
A BOP typically covers three major items:
- Property damage. Similar to a homeowner’s insurance policy, this covers damage to your building (owned or leased), equipment, furnishings, fixtures, displays and inventory.
- Business interruption. If a covered loss strikes your store or warehouse, forcing you to stop operating for a period of time, your revenue stream is protected from lost business income. You can also choose optional protection that covers you in case a major supplier is affected.
- Liability insurance for your business. Covers damages paid in judgments or settlements, and legal defense costs, if you are sued or held liable for accidental bodily injury or property damage arising from a covered cause of loss.
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