Purchasing General Liability Insurance for Small Businesses
All businesses, no matter how small need to be covered by insurance. For one thing, they need to protect their asset in the event of weather, fire or other damage. They also need to protect themselves if something should happen to a customer upon entering their business or utilizing their goods or services. Typically, small businesses need to be covered in case their premises are damaged, but also if they have a lawsuit brought against them for one of their products or recommendations.
General liability covers some essential types of insurance. These include bodily injury and property damage as well as personal and advertising injury. In many instances, small businesses, especially those without employees will only purchase general liability insurance. But let's look at what each of these types of small business insurance mean. Keep in mind that they differ according to each state, so check with yours to find out the regulations on liability insurance.
Some of the things that may go wrong, even with a small business include the following:
- libel, slander copyright infringement or disparagement
- accident resulting in injury or even disability
General Business Liability Insurance
A general liability package covers the small business in case that visitor to the premises, you or an employee is injured while at your business. The coverage includes protecting you in case you or someone you employ hurts property or someone else on the premises. Essentially, this type of insurance covers property damage or bodily injury, but not for employees. That falls under Worker's Compensation insurance. Keep in mind that landlords who rent out buildings or rooms for small businesses require you carry liability insurance.
Professional Liability Insurance
Known as Errors and Omissions Insurance, this is meant to offer you and the company security in case a customer suffers a financial setback from an omission you made. This type of insurance is different than general liability, and keeps the small business safe should a client blame you for their loss, whether in regards to an omission or error.
Product Liability. Businesses that make items for customer use need to be covered i the event that the product insures someone or damages their property. This is known as product liability. Businesses that offer services for sale must also be covered, as they too can be sued if their service causes damages.
Advertising Injury
This kind of insurance protects the small business in even that there is copyright infringement, slander or libel that negatively affects the running of the business.
Home-based Business Insurance
If you operate a business from your home, it's not always protected in case of damage. The small business at home needs separate protection, as it's generally not covered by home owner's insurance, unless you purchase a special add-on to that plan. People who own a business run from home might also need to purchase personal and advertising injury, professional liability, business property and other forms of insurance. Your car is also a separate property that needs to be covered, whether or not you work from home, as vehicles are generally not covered in general liability insurance packages.
Worker's Compensation
This type of insurance is designed to protect employees who work for a business. In the even that an employee is injured or at work or gets sick., and then files a claim against the small business, this type of coverage works to protect you. Many states require this type of coverage, while offering state funds that pay claims. Texas is the only state that does not require businesses to have worker's comp insurance.
