Attention small business owners: here’s a go-to guide for understanding business insurance

So, you’ve started a business. You’ve got business cards & stationery, maybe even a website and have been spreading the word that   “Hey I’m in business”   via traditional and digital methods. Maybe you’ve even appeared at a local event, such as a trade show.

In the mad excitement that followed, did you even give more than a passing thought about insurance for that business?

Of course you didn’t. Right now, it’s all about survival and doing work so you can pay your bills and put food on the table.

But do me a favor- take 5 minutes and answer these 2 questions:

1. Do you have the money available to pay out of your own pocket should your business cause someone else harm?
2. Do you have the money available to replace your inventory? (or business contents if you’re a non-retail location

If you’re a typical small buz owner just getting started, you won’t have the capital/resources to pull from if someone is injured or who’s property is damaged due to your business’s operation.

So, I’m going to give you a crash course in Small Business Insurance 101 (taught by The Insurance Goddess herself ♥).   No fat, just lean information. Because why invest your time & energy into a dream if you’re not going to invest in protecting it?

This is an inside look at how we analyze and make informed recommendations at Alan Galvez Insurance for business insurance. You can also watch a video, and read some additional articles/blog posts about business insurance on our special Business Insurance page.

Commercial General Liability Insurance– At its core, this insurance is designed to pay for bodily injury and/or property damage to others for which your business is legally liable. It consists of two main components-premises/operations and products/completed operations. Here’s an example of each:

• Premises/operations- your storefront. Also could be an off-site event, such as a trade show.
• Products/completed operations- any product/item you produce has the potential to cause harm. Provides coverage once the item is in the end user’s possession. Or after the work is completed (contractors are a great example).

Commercial Property– protects your building and contents inside. Contents can include your stock (inventory) and office equipment (chairs, desks, etc.)

• A word of caution- any contents items that leave the property lose coverage. You can break out individual items on an Inland Marine Schedule (examples include laptops, iPads, or if you’re a contractor, tools & equipment).  

Business Income– a subset of Commercial Property, but important enough to list on its own. Think of Business Income as disability insurance for your business. It provides money to keep your business operating should a loss occur that makes you temporarily cease operations. It can also provide Extra Expense should you have to relocate altogether.

Commercial Auto– Big surprise to many, but personal auto policies say absolutely no coverage if you’re using the vehicle for commercial purposes (check out an early post of mine explaining some key differences). And claim time is when you’ll find this out. No good. And you may be surprised to find out that commercial auto insurance isn’t as expensive as you might think. We use Erie Insurance almost exclusively for commercial auto policies and premiums are extremely competitive. Obviously it depends on what type of work you do, but still……

I’m purposely not getting into specialty items for businesses, since most small biz folks need just the basics.

So, did this help you understand a little better? Something I forgot to mention?  Then please comment.

Still have questions? Want to discuss your business insurance?  Contact me and I’ll be happy to work with you. (Ohio residents only)

As always, thanks for reading.