what is business liability insurance for?
In the very fewest possible words, Business Liability Insurance is valuable insurance that every serious business owner must consider taking out. It will help you protect your assets and preserve your business in times of legal interruption.
Business liability insurance can be confusing to new company owners and even to those who have been doing business for a long time. But it’s something you need to consider in order to be prepared for potential legal issues.
This is true whether you are a home-based business operator, a retail business or any other company, big or small.
The business liability insurance needs to be taken seriously and a good policy does not cost as much as you might think . It can safeguard your business resources (including cash) in case a court action is filed with accusations of injury, damages and even negligence. This is really the area that we are interested in getting protection from when operating a business because people will always be looking for a reason to sue somebody else. It’s sad, but it is a fact of life.
You will be the one spending money on the costs of legal representation, as well as a legal settlement if you’re not covered. However, if you have the right liability insurance, your costs can be covered by your insurance policy except for perhaps punitive damages. These may not be compensated by your insurer because punitive damages are defined by legislation as a punishment for carrying out something deliberate. Aside from this particular cost, all other expenditures of the court action would likely be covered by your company policy.
It is necessary that you read and comprehend the fine print from any business liability insurance policy contract so you know exactly what kind of commercial insurance policy you are getting.
If you are new to business or inexperienced in how commercial insurance works, you should make time to completely understand the different insurance coverages and choose one that fits your unique business situation.
At a bare minimum, you will need a general liability insurance policy that protects you from claims of injury to persons as well as damage to property. When buying a business owner’s policy, also sometimes referred to as BOP, you will usually be offered commercial building insurance too, if you own property or a building, you’ll certainly need this as well. In addition to those two types of policies, you should also ask about other policies you may be required by law to carry. These may include workers compensation insurance as well as professional liability insurance (sometimes referred to as errors and omissions insurance.)
If you’re having trouble interpreting the insurance requirements or even the terminology, your insurance broker or agent has all of the knowledge you need. They can provide you with clarifications of the phrases that you are having trouble understanding so that you do not buy coverage you don’t need. Helping you understand all the details of the insurance plan they are selling you is their responsibility.
Some things you will need to be clear on include things like policy limits, exclusions and even how to file a claim should the need arise.
Limits may be the most important aspect to understand as this pertains to the maximum amount your insurer will payout on any single claim. If you have a $1 Million policy and you get sued for say, $2 Million and lose, then you would be responsible for coming up with the other $1 Million. That could be devastating for many small businesses. As far as exclusions, those are simply things that are not covered by your policy. There’s nothing worse than paying premiums for years only to find out that when you need protection, you are not covered. That’s why you need to know upfront, exactly what will be covered and what will not.
It is sometimes disturbing that our modern society is so litigious especially when situations such as a harmless accident can result in a lawsuit with millions of dollars in claims and damages. But again, it is a fact of like in today’s society. Due to this situation, companies both big and small, yes, even one-person solo businesses, really do need safeguards such as liability insurance.
Business liability insurance shopping is not fun but it is a requirement for all entrepreneurs. The best way to start looking for a good policy is to start online. Get multiple quotes via the Internet then compare them to rates quoted to you by a local insurance agent or broker in your area. And remember, when you are comparing different rates and policies, take into account any exclusions, deductibles, and policy limits. A good policy should give you peace of mind and protect your financial assets in any situation that could arise in your business.
Business Liability Insurance Quotes
These days, it seems like you can get sued for almost anything, which is why as a business, you need to be sure to include business liability insurance quotes in the process of getting started and/or creating your enterprise. Like it or not, if you specialize in giving advice or consulting in a business to business or business to consumer environment, then you can get sued if someone takes your advice and doesn’t like the results they get, whether you are at fault or not.
Most of the cost of handling lawsuits is in fighting them, which is why using business liability insurance quotes to protect yourself is not just important, but urgent. When you sit down with an insurance agent to get a quote, they’ll ask you several details about the nature of your business. Make sure, to be honest, and forthcoming so that they can accurately predict what type of coverage you need.
From there, you can shop around by getting a variety of business liability insurance quotes from several companies, and then decide which one to purchase based on the cost and coverage.
who needs business liability insurance?
Well, consultants of all shapes and sizes can use it to protect them against ill-advised decisions on behalf of their customers. Small businesses of all shapes and sizes can use it to protect their assets in the event of personal injury, fire, other types of catastrophes. Getting business liability insurance quotes will also start the process of protecting you from perceived negligence, fraud, and even in the event that workers injure themselves on the job.
In essence, business liability insurance protects you, the business owner, against all types of unforeseen events that could severely limit or cripple your ability to do business post-accident or lawsuit. Think of it as a small price to pay for the ability to breathe easily.
where do you start getting business liability insurance quotes?
The first step is your local insurance agent, who is likely to either offer the service or know someone that does. Most life insurance and auto insurance companies can provide business liability insurance quotes for free, without an office visit.
You can also check online, where you are likely to find dozens of major insurance companies that offer free business liability insurance quotes for you to compare. Really, getting this type of insurance is easy, considering how much it can protect you and your business.
Though you can probably do most of the research online, I think in this case your best bet is to speak with licensed insurance agents that understand how this type of insurance works. Theoretically, you could do this without leaving your home or office, but I prefer diligence over negligence.
Finally, once you’ve gotten at least 3-4 business liability insurance quotes, you should be armed with the information you need to decide which company to go with, at which point you can call an agent to get started.