Phillip Smith
August 24, 2022
How to choose an insurance plan for your new small business
By Phillip Smith
New business owners often think about talking to an accountant or a lawyer, but many people forget about calling a commercial insurance agent while still in the planning phase of their business.
Your commercial insurance agent is going to help make sure you have the proper protection to help you from losing everything you have worked so hard for. They will also make sure you are accounting for possible risks you may be confronted with when you open your doors, whether those are physical doors or a website.
While many insurance companies offer standard packages, in the end you want to make sure you have the right coverage for you and your business. These are just some of the questions that you should be considering when shopping for the best insurance policy and agent for your needs.
Ask yourself what you are liable for
Some liability considerations are, what if someone slips and falls on your property, or bodily injury caused by your product? Will you be serving alcohol either for profit, or at events/parties at your office? Do you have any employment practice liability exposures? Can you transfer some of your liability exposures to other parties or sub-contractors? What cyber liability exposures do you need to cover? What other hazards might you run into?
Take a look at your property
Did you buy the building or are you renting? If your building or rental space is damaged by a covered loss such as a fire, what portions are you responsible for? How much inventory do you carry and do you have a peak season where you carry additional inventory? Is your inventory raw materials or finished product? What other things do you have such as computers, desks, chairs, display cases?
Employee considerations
If you have employees, you will need to make sure that you have coverage should they be injured while in the workplace. Additional filings may be required if you have any subcontractors, immediate family members working for you, or any officers (including you) that you may not want to cover with your worker’s compensation policy. Worker’s compensation Policies are normally audited every year. Your agent can discuss ways to avoid paying a large audit.
For travel, do you have vehicles that are owned by the company and used by employees? Do employees use their own vehicles for business purposes? Do you have a vehicle that you use for both commercial and personal purposes?
Depending on your business, you may have other coverages available to you that you would want to consider. There may be market segment packages that will extend coverage on certain items that are typically covered for your type of business.
You may need to consider professional liability or errors and omissions coverage, or director’s and officer’s coverage
Starting a new business is an exciting time, from creating a logo and building a website to getting your first client or customer. Before you hang up your “open” sign, it is important to meet with an insurance professional to make sure you are protected from day one.
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