What Insurance Does Your Business Need?
Everybody knows about auto insurance and home insurance, but what kind of insurance do you need if you own a business? Thankfully, there’s a simple policy designed to cover anything that may happen with your business, and it’s fittingly called business insurance.
Business insurance covers any of the losses a business may normally experience. It’s broken down into subtypes, each of which covers something different, including damage to property, accidents involving employees, and legal liability. Here’s everything you need to know about business insurance to make an informed purchase.
What Does It Cover?
As previously mentioned, a business insurance policy is broken down into multiple parts. Each of these parts is designed to cover something different, so it’s up to you to decide which types of coverage your business does and doesn’t need.
General liability insurance covers liability claims for injuries that occur at your business. Professional liability and malpractice insurance will cover you in the event that something your business does or says leads to the injury of another person.
Product liability covers against faulty products and anything that may happen as a result of them. Property insurance covers damage to your business that results from natural disasters, such as fires or storms.
If your business has a fleet, you need commercial vehicle insurance. This is essentially auto insurance for commercial vehicles, so you’ll be covered if something happens to your vehicle or your driver.
If an employee suffers an injury or illness as a result of working, workers compensation insurance will cover that. If you can’t pay the bills or employee wages for a while, you’re covered by loss of income insurance.
Key person insurance is another important type of coverage for many businesses. If key personnel becomes injured or passes away, the resulting loss of income will be covered by this. Cyber-crime insurance covers anything related to internet use and records retention policies have your back if you lose important data.
There’s also specialty coverage, which covers various business risks that are specific to one type of business, such as a farm or a property management company.
What Does It Cost?
As you might have guessed, the cost of business insurance varies based on the size and risks of your business. A Chicago insurance company may be able to cover a smaller business for as little as $500 per year, but a larger corporation may need to spend as much as $500,000 each year to make sure they’re properly covered.
Of course, size isn’t the only factor. You also need to consider which types of coverage you need and how much you need for each of them. The more coverage you purchase, the more your business insurance policy will cost.
Is It Tax Deductible?
As long as you’re using business insurance coverage to operate a business or trade, it’s deductible on your taxes. For more information on whether or not your business insurance premiums are tax deductible, talk to your insurance provider or the tax professional who handles your business’s taxes each year, or visit the IRS website.