Owning a small business doesn’t come without risks. More important than being aware of these risks is finding a way to protect yourself, your employees, and your business from them. Among the many types of insurance out there, the general liability insurance protects you from claims that have to do with bodily injury, property damage, and negligence. It might help you with court settlements, attorney fees, court related judgements, and investigations conducted by the insurance company. Today, we’re going to tell you how to choose a general liability insurance for small business.
General Liability Insurance for Small Business: What Do You Have to Consider?
Hire a Broker
Why do you need a broker? Because he or she can advise you on the policies that would benefit your business best. Brokers connect business owners with policies that are suitable for their business activities. This means you’re going to have to look for a certain kind of broker, namely one that specializes in sourcing policies for the type of business you own.
Review the Risks
As we’ve already mentioned, a general liability insurance protects you from claims that your business is a risk. Which is why you have to assess the risks and communicate them to your broker. Whenever an insurance company determines whether or not they’ll accept a certain business, they look at the risk level they pose. According to that, they also decide whether they’ll provide the entire coverage you’ve requested or only part of it. As a result, you have to be aware of the premium and the deductible. A premium is whatever you pay for the insurance, and it depends on certain risk factors such as building type, business location, and so on. A deductible is how much you’re going to pay when filling a claim.
Go Over the Policy in Detail
Perhaps one of the most important rules is reading the policy very carefully. This way, you’ll understand exactly what your insurance covers. Skipping this step means you may allow errors to remain unchecked and uncontested.
Consider a Business Owner’s Policy (BOP)
Sometimes, small business owners can purchase an insurance package which is called a business owner’s policy. This might be a cheaper alternative, since purchasing different policies from different insurance companies will increase the premiums. The BOP is a standard package, so it comes with essential coverage options. This means the premium you pay is going to be lower than if you were to purchase the types of coverage separately. Some examples of BOPs are vehicular, general liability, business interruption, and property. If your business has risks that are not included in the BOP, you might have to get additional coverage.
Evaluate the Coverage Each Year
Since your business isn’t static, neither are your risks. This is why you should review them annually and check if you have to add any new type of insurance or update an old one. In this way, you’ll always be protected in case of a claim.
Whenever you have to choose a general liability insurance for small business, make sure to go through all of the steps above.
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