Commercial insurance. Insurance for your . . . commercials? No, not quite. This isn’t insurance that will reimburse you if your TV commercials don’t bring in enough business. (That’s another problem.)
If you’re a business owner, or you’re just about to get your big idea off the ground, you want to know exactly what commercial insurance is and whether or not you’re actually protected. Well, you’re in the right place.
Simply put, commercial insurance is the same as business insurance. It protects your company from risks like theft, injuries on the job, lawsuits, health care costs, cyberattacks, disasters and other unexpected events. It can help cover or at least offset some of the costs when bad things happen.
Next, we’ll walk you through all the different types of commercial insurance you might need.
What Does Commercial Insurance Cover?
Unlike the different kinds of insurance you can get just for yourself, commercial insurance includes employees, property and equipment. So your entire business is protected, not just you.
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But commercial insurance is not a one-size-fits-all. Since there are so many different types of businesses, insurance comes in many shapes and sizes (not quite 31 flavors, but close). For example, the risks in running a local roller-skating rink are very different from a construction company doing $500 million in annual revenue.
Here’s a breakdown of the different kinds of commercial insurance you can get. You can mix-and-match these into a package to fit your specific industry and business size.
Types of Commercial Insurance
Commercial general liability protects your business in a general way (this is insurance, not rocket science, after all). Think of it as a base layer of protection. It covers things like bodily injury, property damage, legal and medical expenses. So if someone slips on the ice in front of your store, breaks their ankle and sues you, general liability can help cover these legal costs.
Commercial auto insurance covers any vehicles you use to operate your business. So if you’re in the cookie distribution business, you’re gonna need those trucks insured to keep the cookies rolling.
Property insurance can also be a great piece of your plan. It’s exactly what it sounds like, it protects your physical assets and property. This includes items like tools, inventory in your store, equipment and even furniture. So if one of your warehouses spontaneously combusts, and you lose all of those widgets you just spent six months producing, it’s more of a blip than a devastating blow.
Commercial health insurance is any kind of health insurance offered by a nongovernmental agency. Ever heard of PPOs and HMOs? (Preferred provider organization and health maintenance organization, if you must know.) These are the two most common forms of health insurance that businesses provide their employees. These kinds of medical plans can be beneficial for both the business and the employees. Employers can get discounted rates by bundling a corporate health insurance package and that discount can be passed down to their team. (When it comes to employee benefits like health insurance, check out these do’s and don’ts.)
Workers’ compensation protects you when one of your workers gets injured on the job. Like that time Bobby threw out his back at work while carrying heavy boxes then tripping on a banana peel. (Come on, Bobby, be careful!) Workers’ compensation kicks in and will cover medical costs or lost wages due to time off. It also protects you from getting sued by an employee after an on-the-job accident.
Cyber liability insurance can help offset the damage from data hacks and other cyber threats. Imagine if all your customers’ data, including financial information, was compromised. What would you do? Cyber liability insurance is a great way to fight against these new digital threats.
Crime insurance protects against the threat of forgery, fraud and theft, whether it’s from employees or nonemployees. So when someone smashes your storefront window at your jewelry store and makes off with a $5,000 necklace, there’s insurance for that.
Business interruption covers longer periods of time when you might not be able to make any money due to unexpected events (2020, anyone?). Business interruption insurance also protects against accidents. Like if a fire destroys one of your buildings and you lose revenue for a month or two.
Business Owners Policy (BOP) insurance is when agents or carriers bundle different kinds of commercial insurance into a package. What comes with this bonus bundle? Well, it depends on your business, but here are some common ones that are lumped together: general liability, property and crime insurance.
At the end of the day, you’re probably just wondering about two big questions: How much do I need? and How much will it cost? This all depends on the size of your business, what service you provide, as well as the industry you’re in.
The best way to get the right commercial insurance coverage is to get in touch with one of our trusted insurance pros. Commercial insurance is complicated. They can assess your unique situation and give you free quotes that will make sure you’re covered for all the things that can go wrong when it comes to operating a business.