It is wise for any business to possess a general business insurance policy, which includes liability and other standard coverage. Your place of business, if you own it, should be insured; and if you rent, you still want to possess your own coverage. Don't rely on the landlord's insurance.
If you have one or more employees, there are three types of insurance that are mandated by law; social security, unemployment and worker's compensation insurance. Social security and unemployment plans are administered through payroll processing and workers compensation is arranged either through private insurance of employer self-insured coverage.
Additional insurance needs may be viewed in terms of the party to be protected. For example, to protect employees beyond unemployment and worker’s compensation, you may offer health, disability and key employee insurance.
Key employee insurance provides financial relief should a key owner or manager die or become unable to work. Other forms of insurance intended to protect business operations include business interruption insurance, surety bonds and employment practices liability insurance.
Depending on your industry -- for example, food service requires product liability insurance -- you may need additional types of insurance. If you already have insurance coverage, begin investigating coverage options and requirements with your present insurance agent. Obtaining quotes from several agencies is also recommended, being sure to compare both coverage recommendations AND price.
The State in which your business operates in also has a State Department of Insurance. It is this agencies mission to protect consumers by administering and enforcing insurance laws in the most responsive and cost effective manner to ensure the financial reliability and responsibility of all regulated entities. To contact your State Department of Insurance, visit SMEToolKit Small Business Frequently Asked Questions
Run your business. Don’t let it run you.
SME Small Business Learning Series
1. SMEToolKit Small Business Frequently Asked Questions