It may seem that your insurance agent is just being pushy because there are so many types of insurance coverage available for business owners. It's important to know where all of the potential liabilities are in your business to make sure that you do whatever you can within your budget to be protected through insurance. Here are some common types of business insurance you should be aware of:
General Liability - This is pretty common and if you have your own (non home) office, you landlord or mortgage company will require this to protect both of you in the event that someone gets hurt on the property and sues.
Professional Liability - Also known as Errors and Omissions coverage or malpractice insurance for medical professionals. In the event that you make a mistake that ends up costing a client money, this is designed to protect you as long as you did everything that you were supposed to in an ethical manner.
Key Man / Key Person (Insurance - If there is an individual in your organization who is so crucial to the success of the business that his or her death could potentially end the business, this is a form of business insurance you will want to consider. It's basically a life or disability insurance policy on a that person (or people.)
Legal Protection - Every business needs a lawyer. Some have them in house, some have them on retainer, some pay as they need them (and subsequently pay more) and some companies take lots of losses because they don't realize the value of having one. For growing businesses, one thing I recommend is having a legal services plan for their business. It can cover lots of things relevant to small business operations such as free advice on legal matters, reviewing documents and writing collections letters, all for one low fee. In my business, it's been a HUGE savings and in many cases allowed me to have the legal protection usually available to companies much larger than mine and for a fraction of the cost. To learn how to get such a plan, visit: http://www.prepaidlegal.com/biz/thefinamarkgroup to learn about Legal Shield's small business plan
Workers Compensation - If you employ at least one person other than yourself, workers compensation insurance is a legal requirement. It protects you against claims by your employees against injuries suffered as a result of their job. In the end, it really protects the employees, and the government requires you to pay for it..
Commercial Auto - Does your business operate vehicles that your employees drive? Then surely you are aware that you need to have a commercial auto insurance on these vehicles beyond personal coverage. The obvious reason is the high volume of driving increases the likelihood of an incident or accident. And those can be very costly, so make sure you not only have coverage, but have enough coverage.
Group Insurance - One way to attract great employees is to offer great salary and benefits. Sure it's costly, but it will also decrease employee turnover which is also very costly. Common group insurance benefits include health, life, disability, legal plans, 401k plans, and dental insurance.
These are the basics and in some cases, asking your insurance agent about an umbrella policy can save you money.
About the Author:
Anthony Kirlew is a lifelong entrepreneur who runs a full service digital media agency (AKA Internet Marketing), runs a business consulting practice, and also manages a personal finance blog (FiscallySound.com.) He is a big advocate for the insurance industry and is currently finishing a book that will educate consumers on insurance options. As a disclaimer, he is a registered Associate with Legal Shield who offers the legal services plan mentioned in this article.
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