What types of insurance will you need? Do I need all of them? It is a daunting question to ask especially for a new upstart business who is trying to control costs. What types of insurance and the amount of coverage would really depend on the nature of the company. It will be a good idea to sit down with an insurance agent to see what the best possible protection plan can be for your budget.
There are several major types of insurance that you can get for your business. Some of the most common are liability, property/casualty, auto, workers compensation, health, and others.
Liability insurance covers the basics of anything happening to a worker or a customer in the operation of your business. I will cover any negligence on the part of a business or a worker who causes injury or harm to a customer. Liability insurance is usually mandatory in running a business. Just like auto insurance, liability insurance is required.
Property/Casualty insurance is often sold in conjunction with one another. The simple explanation of the difference between property and casualty insurance is that property insurance insures the location and physical parts of the business while casualty insurance protects the business itself from disruption due to some event. Property insurance would cover the business in the event of a fire, casualty insurance would protect the business if an employee were to steal merchandise.
Auto insurance really only comes to play for a business who uses automobiles in the running of the business. For instance, if the company is a delivery company, it will need to insure all of its vehicles for liability, theft, damage etc. It would just be like a personal auto insurance but for business.
Workers compensation insurance like liability is also mandatory. Workers compensations insurance comes to play when your business has employees. The insurance covers compensation to employees when they get injured on the job. This type of insurance protects the business from being sued for non negligent injuries that occur during the work day. It prevents an employee from suing the company directly but to obtain benefits from workers compensation.
Lastly, there is health insurance. There are a lot of news on this matter lately with the passing of the universal health care plan. It is unclear how this will affect business in the long run however, most business do provide some sort of health insurance for their employees and their dependents.
This is a summary of the major types of insurance that a business can get. Again, what type of insurance you get will depend on many factors. The smart thing for any business to do is to get some help and to determine the best coverage for the budget. There are many insurance agents out there, such as State Farm, Farmers, Allstate etc..