If you're a small business owner, you've likely invested most of your time, energy, and money into your company. With all it takes to start and run a business, the small business often feels like an extension of your family. Like you would protect a family member, small business owners want to protect their investments from unfortunate circumstances.
Much like you would purchase health insurance to protect yourself or your family in case of serious injury, it's prudent for small business owners to consider all the different types of business insurance available and take the necessary steps to secure the proper protection.
For a new business owner, it helps to understand that business insurance is vastly different from regular insurance. It's akin to having a prepaid legal team for your business for just about anything. Generally, it's not as expensive as you think, especially if you compare it to healthcare or auto insurance. The first step to take is determining the type of business insurance needed.
Determine the Type of Business Insurance You Need.
Even if your structure your business as a limited liability company (LLC), it only offers limited protections. For the most part, with an LLC structure, only your personal property is protected from lawsuits and in a limited fashion. That is where business insurance provides extra protection to ensure your and your business assets are fully protected in all worst-case scenarios.
If you have a business with employees in America, you must have workers' compensation, unemployment, and disability insurance per the federal government. Depending on your state, you may be required to hold additional insurance. We suggest checking out the state-by-state comparison of workers' compensation requirements to ensure your business is adequately covered.
Types of Business Insurance To Consider.
Determining the type of business insurance you need can seem daunting, leaving minor business owners overwhelmed. For example, if you have a storefront with customers coming and going daily, that is riskier than someone operating online.
Entrepreneur recommends small businesses consider seven different types of insurance: professional liability insurance, property insurance, worker's compensation insurance, home-based business, product liability insurance, vehicle insurance, and/or business interruption insurance.
Never fear; King's Dream is here! We will break down the various types of business insurance available to better help you decide what your particular small business needs.
Steps To Buying Business Insurance.
Now that you know the diverse business insurance options available to protect you and your small business make sure to follow our step-by-step process below.
Determine Your Risks- As mentioned previously, each business's insurance needs vary from one another depending on their specific risks. By reading the insurance list above, take time to analyze your business's risks carefully.
Find a Trustworthy Licensed Agent- Finding a trustworthy licensed agent can feel like hunting for a needle in a haystack. Getting more than one quote, reading reviews, and consulting with a business mentor are some of our favorite tips for finding an insurance agent you trust.
Browse Various Quotes- Never settle for the first quote! Getting more than one insurance quote will not only ensure you get the best rate possible; it offers confidence of protection for some of your most valued assets. Additionally, this step provides an opportunity to see what options are available for bundling insurance should you need more than one. We recommend getting an instant quote from NEXT insurance as they specialize 100% in small businesses.
Reexamine Yearly- Every year, take time to reevaluate the needs of your business to see if you need any additional insurance. Conversely, you may find it an excellent time to drop insurance that is no longer needed, saving your small business money.
For sure, business insurance is critical, so don't skip these steps. It only takes one lousy lawsuit to put you out of business. The last thing you want to do is get sued and not have access to prepaid attorneys to defend you and your business.
Still unsure how to protect your small business? Contact us today for a free consultation.
About The Author
Kristin Burke is a small business marketing expert, author, and urban gardener. As a former food truck owner of Chicago's first schnitzel truck, she has first-hand knowledge of launching a small business successfully. She has been a writer for various small business blogs since graduating from the University of Chicago in 2008.