Back to Basics: Insurance

One of the cheapest ways to protect yourself as an entrepreneur or business owner is to have appropriate commercial insurance.

Be strategic about it. Figure out what risks you have that insurance can cover and get an appropriate amount. If you are just starting out, check with your home/auto agent, but don’t be surprised if they can’t help you. Insurance agents specialize in different areas, and commercial lines of insurance are different from personal lines like home and auto. Reach out if you need a recommendation.

Typically, a business starts with general commercial insurance, which covers your business against claims made by others including bodily injury, damage to property, or personal injury. This includes things like a slip and fall at your place of business or if one of your hardwood floor installers accidentally cuts through some electrical or plumbing lines at the customer’s house.

You can add coverage for vehicles used in the business, plate glass windows, property you own or lease, and workers comp. Remember, even if you are not required to have workers comp (at the third employee, full or part-time, including the owners), your company is responsible for medical costs for an employee who is hurt on the job.

I am a big believer in umbrella coverage as well. If you are just starting out, talk to the agent who handles your car and home insurance (personal lines). Don’t be surprised if they don’t have expertise in commercial insurance or their company won’t handle your type of business. Ask them for a referral or ask me.