Four Types of Insurance Every Small Business Should Consider

Starting a new business is an investment. There’s the time and money you spend setting it up. And there are monthly expenses to keep it running. So it makes sense that you want to protect the new business you’ve worked hard to establish. That’s where insurance can help. Here are four types of insurance a business owner should consider to protect their new business investment.

Insurance is designed to protect against the unforeseen – a fire, theft, injury, illness, disability, liability. The key is to identify how much risk you are willing to assume and how much you want to share by purchasing insurance. Consider these types of plans and discuss them with an insurance professional to find out what’s right for you.

Property Insurance

This helps to cover loss and damage of business property from events like fire, smoke, wind/hail and vandalism. It covers items like the building, merchandise, equipment and, in some cases, lost income. Even if you operate your business out of your home, you may still need to purchase coverage in addition to your homeowner’s insurance. This type of insurance is often required to secure a business loan.

Liability Insurance

This helps to cover loss from legal judgments due to accidents, injuries or claims of negligence incurred at your business. You can also purchase product liability coverage for loss due to a defective product you offered. Professional liability insurance protects against malpractice, errors and negligence from the services you provide.

Health Insurance

This helps to pay for health care expenses incurred by you or your employees due to an illness or injury. The cost of these plans can be paid entirely by the owner, shared between the owner and employee or paid entirely by the employee. While not required for businesses with fewer than 50 employees, you may choose to offer coverage under the Small Business Health Options Program and be eligible for tax credits.

Life/Disability Insurance

These plans can be structured to pay benefits to the business if the owner becomes disabled or dies prematurely. This can provide the funds needed for a remaining partner or family member to continue the business. It’s also important for owners to consider personal life and disability insurance to protect their families as well.

It is important for owners to protect their small business investment by meeting with an insurance professional to discuss which plans they need. If you have employees, you will also want to discuss Workers’ Compensation and unemployment insurance. For more information, see the Small Business Insurance section of

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