There are many liability risks that small businesses are exposed to that they need protection against, which is where liability insurance comes in. However, there are many different types of liability insurance available, and you may not need all of them. These are some of the different types of liability insurance and when your small business might need them.
General Liability Insurance
This insurance covers claims of injury and property damage. If there is a slip and fall accident in your business and the customer makes a claim against you to help cover their medical costs, this insurance will help cover the costs of the claim.
General liability will also cover if someone else’s property is damaged by your business. This also covers if someone rants about your client online and the client ends up suing you for libel, this insurance will also cover that.
Commercial Liability Insurance
This is insurance covers three different types of incidents in your business. It offers property insurance, which will cover damage to your business’ location and equipment. It covers workers’ compensation, for if your employees are injured at work. Commercial liability also covers public liability insurance, which has some overlap with general liability, helping cover medical expenses if someone is injured on your premises.
Commercial Property Insurance
This is important for your business whether you rent or own the building where your business is located. If you own the building, you need this to insure the property for its costs of replacement. Whether or not you own the building, you need to insure everything in the property. This covers everything inside, including your phones, computers, and chairs.
This insurance also covers things like vandalism and theft.
Commercial Auto Insurance
If your business owns vehicles or relies on the vehicles of others for work-related purposes, you may be legally required to have this insurance. This is similar to your personal car insurance, just on a bigger scale. If your employees are using their personal cars for work-related matters, it can cover their cars when they are using them for business-related matters. So, for example, if your employee gets in a car wreck while on the clock, this will help cover it, but if they are driving home at the end of the day, off the clock, and they get into a wreck, your insurance is not obliged to cover them.
Employee Practices Liability Insurance
This insurance will cover employee-related incidents, like if your small business is sued for unfair employment practices, sexual harassment, hostile workplace claims, or discrimination.
Professional Liability Insurance
This is good for if there is a claim that your business had errors or omissions in the products and services you provide. Like if a hair salon accidentally turns your hair green when it was supposed to be dyed black; this insurance would cover costs to settle a claim like this.
It also can cover the costs of clerical errors. For example, if a patient in a doctor’s office was scheduled for the wrong type of appointment, and the service was performed anyway, this insurance would help cover the costs of any claims about that.
Employer Liability Insurance
This is another facet of workers’ compensation. Workers’ compensation will cover your employee’s medical expenses if they are hurt on the job, and it can cover lost wages. Sometimes, an employee feels like workers’ compensation is not enough and they may sue you for more damages than are covered by workers’ compensation. This is where employer liability insurance comes into play.
Cyber Liability Insurance
This is still a fairly new type of liability insurance, but it is an important one in the digital age. If there is a digital threat to your business, this insurance can help cover the problems that arise. Your policy can cover hackers, extortion, and data breaches.
Since so many companies store important information about their customers in their computer systems, there is a lot of data that can be jeopardized if someone successfully hacks into your company’s computers.
