General Liability and Property Insurance Coverage
General liability insurance and property insurance is the main heading under which all other types of commercial insurance fall. Most companies that are low risk and small to medium in size should consider a combination policy which includes the policies below and is known as a Business Owner’s Policy or BOP and is the most common type of commercial coverage.
- Commercial general liability insurance coverage (protection from claims of property damage or bodily injury)
- Property insurance (to protect physical assets)
- Under certain conditions, a BOP may also cover the lost income and expenses that a business owner incurs
Commercial Auto Insurance
Whether you use vehicles to provide mobility for your employees, equipment or products, you cannot operate without comprehensive company car insurance. In many cases road conditions, weather and other drivers are out of your control. For example:
- A sudden traffic shift causes you to lose control of your vehicle
- Hail or vandalism damages your car
- An uninsured driver hits your vehicle
That’s why it’s important to have business auto insurance to protect the vehicles you use for your business. Contact an agent today and get a free customizable commercial auto insurance quote that can include:
- Auto liability
- Medical payments
- Comprehensive coverage
- Collision coverage
- Uninsured and underinsured motorists coverage
- Coverage for autos you borrow or rent
Business Property Insurance
Whether you own your building, lease your workspace or work at home, it is imperative to protect your business’ physical assets. There are many reasons to get Commercial Property Insurance such as:
- A fire could destroy your building and the contents inside
- A burst water pipe could damage your documents, drawings or other valuable papers
- A storm could damage your outdoor sign
That’s why business property insurance is one of the most important investments ensuring the future of your business. Commercial property insurance will cover you if you have commercial or rental building property to protect including:
- Your building
- Your outdoor sign
- Your furniture and equipment
- Your inventory
- Your fence and landscaping
- Others’ property
Umbrella Liability Insurance?
Umbrella liability insurance protects you when accidents happen and your existing liability insurance policies cannot cover all expenses. Standard business liability coverage will take care of you in most situations, but when serious situations arise, umbrella liability insurance will help ensure that your business is protected. While no one wants accidents to happen, they do – and people sue. Here are a few possibilities:
- Your company holiday party gets out of hand resulting in various injuries and damages
- Your building has a carbon monoxide leak that results in multiple injuries and/or deaths
- Your business fails to render the appropriate professional services
Umbrella liability insurance for small businesses, is also known as excess liability insurance or commercial umbrella insurance, provides additional protection when your business exceeds insurance limits on an underlying policy.
For a single premium, umbrella liability or excess liability policies add another layer of protection to any of several other policies that you might hold, including general liability, employer’s liability, and hired and non-owned auto liability policies. For instance, if you have $1 million in general liability coverage and a covered claim is settled for $1.5 million, your small business’s umbrella liability insurance policy would pick up the additional amount.
Excess liability insurance is generally the most affordable way to get higher policy limits on several other small business insurance policies. However, you should note that umbrella liability insurance does not extend the coverage limits on an errors and omissions or professional liability policy.
Professional Liability Insurance, or Errors & Omissions Insurance?
While general liability insurance is primarily focused on property damage or bodily injury, errors and omissions insurance, also called professional liability insurance, protects you if a client claims that your services caused them to suffer a financial loss.
Many professional services companies choose to purchase E&O insurance policies, which are typically issued in increments of $1 million and have per-claim deductibles ranging from $1,000 to $25,000.
Some insurance companies are reluctant to issue professional liability policies, while others specialize in policies for specific professions. Because we have access to multiple insurance carriers and work with a wide range of small business professionals, we know how to find E&O insurance coverage that is comprehensive and yet fits your small business’s budget.
It’s important to note that almost all professional liability insurance policies are sold on a “claims-made” basis. This means that the insurance only covers work performed while the policy is in force, and for claims actually filed during the term of the policy. If you cancel your E&O insurance policy without arranging for an extended reporting period, your coverage would end, and any claims submitted after the cancellation would not be covered, even though the work was performed while the policy was in effect.
It’s also important to know that there are exclusions in every errors and omissions insurance policy. Before you purchase this type of policy, you’ll want to think about the most dangerous threats and professional risks for your business, and look for a policy that covers those specific risks.
What Is Workers’ Compensation Insurance?
Workers’ compensation insurance, sometimes called workman’s compensation insurance, workers’ liability insurance or workers’ comp insurance, covers your employees’ medical expenses and at least some portion of their lost wages if they are injured on the job.
Most states require companies to purchase workers’ compensation insurance for their employees. A few states have “pools” of insurance that is available for you to purchase, but in most states, companies must find private workers’ compensation policies.
Because workers’ comp insurance is mandated by law, small-business owners often think that it is just one more overhead expense that provides little benefit. But good workers’ compensation insurance is actually an affordable benefit that protects both you and your employees.
Following are the optional parts of workers’ comp insurance policies that have an impact on the cost and value of the coverage for you and your employees:
- In the employers’ liability section, or “part two” coverage, your legal expenses would be covered if an employee makes an inappropriate claim of work-related illnesses or injuries. While this section is almost always included in workman’s compensation insurance, you can choose the amount of liability coverage in this section.
- Coverage for employees who are injured in states outside those where your business normally operates.
- Coverage for various types of injuries and illnesses. The mandated part of this section depends on the state where your business is located, but you should be aware of what is and is not covered.
- Coverage for funeral expenses and financial support to dependents.
- Reimbursement percentages for lost wages.
The cost of workers’ comp insurance can vary widely depending on these options, so if you are comparing premium costs, you need to be aware of these variables.
What Is Employment Practices Liability Insurance, or EPLI?
Legislation such as the Family Medical Leave Act and the Americans With Disabilities Act, plus a growing number of job-related lawsuits and claims, have created the need for business owners to consider a type of insurance known as employment practices liability insurance, or EPLI. An EPLI policy offers insurance protection against claims and lawsuits that are brought against a business, its officers or directors, or its employees and managers. These policies generally cover charges in the following areas:
- Gender, age and other types of discrimination
- Sexual harassment
- Wrongful termination or discipline
- Negligent compensation, promotion or hiring decisions
- Breach of contract for employment
- Emotional distress or mental anguish
- Invasion of privacy
- Libel or slander
- Employee benefits mismanagement
While some directors’ and officers’ insurance policies contain employment practices liability insurance coverage, such coverage can be limited to directors and officers, and may have greater exclusions than a standalone EPLI policy.
How does employment practices liability insurance protect your business?
All companies, regardless of size, should look to their personnel policies as the first line of defense against both the number and severity of employment-related claims. EPLI coverage is another valuable tool in a comprehensive risk-management arsenal.
EPLI policies are written on a claims-made basis. This simply means that covered claims must be reported to the insurance company while the policy is in effect, or within an extended period specifically described in the policy. In addition, the event leading to the claim must have occurred either on or after a specific date – typically the date when the EPLI policy commenced. Some insurers offer extended retroactive dates or full protection for earlier claims, but you should be sure you understand these terms.
The cost of EPLI coverage will vary based on the type, size and risk profile of your business. The insurance company may also want to see your written personnel policies to help them determine the risk and cost of your EPLI policy.
Following are additional factors that affect the value and cost of EPLI coverage. It is important to review these exclusions and coverage limitations when evaluating your policy:
- You can generally purchase EPLI coverage with limits ranging from $1 million to $25 million.
- Most employment practices liability insurance policies include a deductible. In addition, the cost of legal defense is typically included in the aggregate insurance limits, along with the costs of judgments and settlements.
Some EPLI policies contain exclusions that limit coverage during events such as a major work force reduction, acquisition or merger. Generally, criminal conduct is not covered by EPLI.