INSURANCE >> BUSINESS

Small Business Insurance

It can be difficult to determine which kind of insurance you need for your small business. Different types of insurance have confusingly similar names; your state, town, or county may have its own insurance requirements; and many industries have coverage specific to them.
Insurance is one of the most neglected small business responsibilities. Not having the appropriate insurance for your small business is a mistake because a disaster can shut down your company permanently, or at least wreak havoc on your assets.

The Insurance Information Institute (III) in New York City estimates that about 40 percent of small business owners have no insurance at all, because many falsely believe they can't afford coverage. The truth is a small business can't afford not to have adequate insurance. Without insurance, you're unnecessarily putting your livelihood at risk. That's also why many landlords, suppliers, and other entities you work with will probably require you to have coverage.

Business Owners Policy (BOP)

A standard business owner's policy provides coverage for property (fire, wind, theft, etc.), liability (injury of someone in your business or by your product), business interruption, and, in some cases, workers' compensation. The components of each BOP are different, so be sure that your policy contains all the components your business requires.

BOPs were originally designed for small businesses, often retail, such as stationery or hardware stores. Today, BOPs are available for a broad range of businesses covering most major industries and professions. If your business has more than 50 employees, or very high sales volume, you may not be eligible for a BOP and will have to purchase a package with the same elements at higher limits.

Business Key Person

Consider this coverage if you are in a partnership, or if the survival of your business depends on a key employee. Key Person insurance is essentially a form of life insurance that covers you if this person dies. It may cover income this person generated, or the cost of replacing the functions he or she performed for your company. In the case of a partnership, key person insurance may make it easier for the surviving partner or partners to acquire the deceased partner's shares from his or her heirs.

Buy-Sell Insurance

If you are a member of a partnership, you may also want to carry Buy-Sell insurance. If one of the partners dies or becomes disabled, Buy-Sell insurance provides the surviving partner or partners with the money to buy the deceased or disabled partner's share of the business.

Commercial Package Policy - Property

As the name suggests, property insurance provides coverage to your business for loss or damage (such as fire or vandalism) to your property. Most business owner's policies include property insurance. Business property coverage typically falls into two categories: building and personal property.

• Building - This coverage is sometimes referred to as "real" property. It protects you should something happen to your building. Be sure to analyze your policy to see exactly what it includes - these policies typically cover damage caused by fire, lightning, wind, vandalism, or the weight of snow on your roof. Some things such as earthquakes, hurricanes and even general wear and tear are often excluded.
• Personal property - This covers a business for loss of, or damage to, the property inside its building, such as files, office furniture, inventory, materials, etc. Check to see if your policy includes your computers and your phone system; your insurer may consider these to be "special" property and require additional coverage.

Commercial Package Policy - Casualty / General Liability

Casualty insurance (also known as liability insurance) refers to coverage for injury to another person or damage to a person's property for which you are legally responsible. General liability is a standard element of most business owner's policies.

General liability insurance will cover your business in case of bodily injury to someone or damage to someone's property that occurs on your premises. For example, this type of insurance would cover you should a client trip over a loose phone cord in your conference room and break an arm. Similarly, if you were to accidentally knock over and break an expensive antique at a client's premises, your general liability policy would reimburse the client for the damaged property.

Professional Liability (Errors & Omissions) Insurance

Professional liability insurance, also commonly referred to as errors & omissions coverage, is the service equivalent to product liability insurance. It protects you financially in the case of a claim against you for negligence, errors, omissions, or wrongful acts in the performance of your duties. It includes coverage for malpractice, errors, and omissions.

Commercial Automobile Insurance

If you use your personal car in the course of your business and you infrequently have customers in your car, most insurance companies will let you pay a little more for business use under your personal auto policy. However, if you have cars, vans, or trucks used primarily for business, you will likely have to buy a separate business auto policy.

Auto policies cover physical damage to the car, but do not cover the contents of a car, so if you travel outside the office with valuables (such as demo units, computers, samples, etc.), make sure your property policy covers loss outside your business. If other people will be driving your car for the business, put their names on your policy to ensure coverage in the case of an accident.

If your employees use their own cars in the course of working for you, you may need to get a non-owned auto insurance policy that provides coverage in case something happens when they are working for you.

Group Life Insurance

Finding quality employees is only part of the challenge of running a successful business. Maintaining a well motivated staff is probably a more difficult challenge. In today's labor market the quality of benefits offered by the employer is a substantial consideration of both prospective and current employees. They are also interested in retirement and security for their families and often times they look at the size of the benefit in contrast to their out-of-pocket costs. Group life insurance is a valuable perk to offer potential employees.

Worker's Compensation

Worker's Compensation insurance covers employees in case of work-related accidents. Most states require you to have workers' compensation insurance for any employees, even part-timers. Some states only require workers' comp insurance for companies with three or more employees.

To keep the cost of your workers' compensation as low as possible, be sure your employees are classified properly. If you do not inquire about this, all your workers may be lumped into the highest - and most expensive - category of coverage. Some states also require you to purchase disability insurance that covers employees in case of any accident regardless of where it happens.

At My Twin Cities Home we will search a variety of companies to try to get you the best policies for your needs. We work with lots of different providers so you have a great selection of what is available in the marketplace.