Enough and the Right Kinds of Business Insurance. What types of insurance should your company get? As much as you can afford, generally speaking, as long as it covers your potential losses and liabilities and you can afford the premiums. We all complain about the cost of insurance premiums, but coverage of a loss or lawsuit can mean the difference between the life or death of your company.
What types of business insurance are there? Here are some:
- General liability coverage
- Errors and omissions insurance
- Workers’ compensation
- Commercial vehicle coverage
- Business income insurance
- Professional liability insurance
- Data breach coverage
- Employment practices liability insurance
- Property coverage
All these may be a good idea for your business, though you’re probably exposed more to or less to some losses more than others. What and how much they cover depends on policy exclusions and limits on what the carrier will pay.
The policy will have coverage to a given dollar amount or limit. There are usually two kinds:
- Aggregate limit: The most a company will pay on all claims during your policy period
- Per-occurrence limit: The maximum it will pay for a single claim
How much business insurance coverage you need depends on the size of your business and how potentially dangerous your work. You may have few employees, but if a mistake might level someone’s house, you’ll need a lot of coverage.
Your coverage will depend on how much protection you feel your business needs as well as what you may be contractually obligated to have. You may need certain coverage if you’re leasing commercial space or showing you can compensate a client if you make a professional error.
Tony Liu is an attorney representing businesses in Southern California. He helps them choose the right insurance for their needs and helps clients with disputes with insurance carriers. Call him today at (714) 415-2007 for a free consultation.