Different Types of Commercial Insurance

Commercial insurance can be a valuable part of your business, no matter the industry or size. Commercial insurance has been and continues to be a cost-effective way for businesses of all sizes to protect themselves from unexpected costs in any circumstance.

For instance, in times of significant financial loss, a specific business can get quick access to money to fuel its business operations.

The type and amount of coverage you receive for your commercial insurance needs are often based on the type of policy and policy limit you choose for your professional organization. Depending on your business, you may be legally required to provide some form of insurance cover for the business and its employees. Therefore, knowing the common types of commercial insurance can be a good idea, even if it’s for informational purposes.

General Liability

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The business landscape varies in size, scale, and industry. There are some perks a small business owner enjoys in the U.S. which are out of reach for larger companies. Commercial insurers tailor their packages in line with these unique needs offering different types of business insurance coverages that best fit each business’s situation.

Among all the types of commercial insurance, general liability insurance appears to be the most common. Commercial general liability insurance claims often arise from negligent acts on the business or employee. Such products or policies usually cover medical expenses and legal fees in determining the responsible party. This type of commercial insurance comprises public and products liability. Public liability deals with coverage options if any public member suffers a bodily injury or personal property damage from your business’s activities. Product liability arises from consumers getting ill or injured from products you manufacture, sell, or supply.

Employer’s Liability

This type of commercial insurance can be part of a business owner’s plans to protect a particular business’s staff. In the U.S., employers’ liability may be mandatory no matter the number of employees you have. Employers’ liability protects the business from compensation claims in times of work-related injury cases, personal property damages at the workplace, and more. Employers may require experienced agents or an internal legal advisor to manage such lawsuit issues.

Professional Indemnity

Professional liability insurance comes in handy when your business provides professional services to clients. Professional liability insurance protects your business if any client suffers major losses from your advice or services. This insurance coverage applies to legal fees and compensation payments.

Property Insurance

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Commercial property insurance safeguards your business property and its content. Getting a commercial property insurance policy can protect your office space in times of natural disaster, vandalism, theft, and fire. Commercial property coverage also gives policy owners additional coverage for any income losses arising from the accident.

Business Interruption Insurance

Accidents like a blow to your district’s local grid can interrupt your workflow and income generation. That’s where business interruption coverage comes in. Business interruption insurance can provide funds to replace affected machinery and systems. Some businesses can also enjoy operating from temporary locations as the affected place undergoes maintenance. Many insurers bundle business interruption insurance into their business owners’ policy (BOP) packages and general and commercial property insurance options.

Workers’ Compensation

According to the Bureau of Labor Statistics (BLS), over 5,000 workers lost their lives due to work-related injuries in 2019.

This number is likely to rise as many states across the U.S. consider the COVID-19 pandemic a work hazard. Therefore, opting for workers’ compensation insurance can be a good idea. Many states and regulatory bodies even treat workers’ compensation laws as mandatory for all businesses. Without a workers’ compensation policy protection, businesses risk expensive out-of-pocket settlements for medical expenses, punitive damages, and lawsuits.


Interesting Related Article: “How to Choose the Right Insurance for Your Startup