Is It Hard to Get Small Business Liability Insurance?

 

Small business liability insurance is protection no small business owner should be without, especially in a litigious society such as the one we're living in here in the U.S. A single injury that one of your customers or employees suffers could spell financial disaster to your business without some good small business liability insurance to help cover the cost of a liability suit.

Getting Small Business Liability Insurance

Small business liability insurance is easy to obtain and is offered by most insurers selling business insurance. There are numerous types of business liability insurance, including:

• General Liability Insurance, which protects you against financial losses resulting from lawsuits stemming from bodily injury, property damage or slander, and for costs associated with legal defense and judgements.
• Product liability Insurance, which protects you from financial losses resulting from lawsuits stemming from defective products causing property damage or bodily injury.
• Professional Liability Insurance, which protects you from financial losses resulting from lawsuits stemming from claims of malpractice, errors, omissions or negligence.

Steps to Buying Small Business Liability Insurance

There are some basic steps you can take to get your business liability insurance. Start with a clear assessment of what types of risks your business faces. What kinds of accidents or lawsuits could be damaging to your company?

Contact a well-regarded, licensed commercial agent who can recommend coverage that best matches your insurance needs. Use an independent agent with access to a number of different insurers and let them offer you at least three insurance options. Compare the different terms, rates and benefits and pick the policy that best suits your particular insurance needs. After a year, re-access your business insurance needs and upgrade as needed.

Home-based Businesses

• A small home-based business, operated out of your personal home, can be protected for a small amount of business property loss and liability claims by adding a rider to your existing homeowners policy. The amount of liability coverage you need will depend partly on whether or not you have clients or customers coming into your home to conduct business. An umbrella policy can be added to your coverage for increased liability coverage. These policies are reasonably priced and add coverage to your existing liability protection.

3 Answers to Uncommon Insurance Questions

The subject of insurance can be a confusing one, and for someone with little or no experience in this area, there may be countless questions to be answered. If you've ever heard the term “insurance poor” used by someone, it likely came from someone facing premium payments for:

• Homeowner's (or renter's) insurance
• Vehicle insurance
• Life insurance
• Health insurance
• Dental insurance
• Disability insurance
• Travel insurance
• Umbrella insurance
• Insurance on a car loan

For someone owning a business, you can add to this:

• Professional liability insurance
• Property insurance
• Workers' compensation insurance
• Product liability insurance
• Vehicle insurance
• Business interruption insurance
• Home-based business insurance if involved in a home business

Who Should You Ask For Info?

When faced with deciding what kinds of insurance you need and how much you should consider for each type, it's best to obtain the advice of a professional. Better than going to an agent representing a singular insurer, you would likely be better served by consulting with an independent insurance agent able to tap into coverage offered by multiple companies in order to get an unbiased idea regarding what's available and the ins and outs of each type of coverage. In asking questions, here are some uncommon questions to consider that don't often come up:

1. Q – If I allow someone else to drive my vehicle and they're involved in an accident, are they covered by my vehicle insurance?
   A – In most cases, anyone else driving your vehicle will be covered by your insurance if involved in an accident, provided they are determined to be at fault.

2. Q – The water pipes in my home burst and ruined many of my personal possessions. Will my homeowner's policy cover replacement?
   A – Such water damage is covered by most standard homeowner's policies with a few caveats. Valuable items such as expensive artwork, furs, collectibles (such as a baseball card or stamp collection), jewelry, etc., will have limits, often conservative amounts, on how much will be paid on a claim.

If you're away from home for seven days or longer during cold weather and the pipes freeze and rupture because you didn't make provisions to prevent this, you likely won't be covered.

3. Q – If a family of rodents gains entry to my attic space and causes significant damage, will my insurance pay for repairs?
   A – Unfortunately, critter damage caused to your home is not covered.