Do you need liability insurance for your small business?

You know you need to protect your assets. Forming a legal entity gives your business limited protection. Most businesses also need insurance.

Most small businesses need liability insurance.

What is the best liability insurance for your small business?

The best insurance protects your business and personal assets.

Risks can stop your small business from running. The Small Business Administration (SBA) says insurance helps businesses to:

• keep running,
• get financing,
• and keep employees.

Liability insurance gives you protection from liability claims.

Basic business insurance policies include:

• general liability,
• professional liability,
• and directors and officers (D & O).

General liability insurance provides coverage for physical damage to persons and property.

If a customer falls in your store, general liability insurance covers the cost. It will cover your computers if the roof falls in. It will cover vehicles owned by the company.

Do your employees drive their own cars? You might need more insurance.

For example, do you have an employee who backed over a client’s mailbox? Add a rider for non-owned auto liability to your general liability policy. Now you have coverage for any mailboxes your employee backs over.

Is your company dependent on a database? Most general liability insurance plans do not cover data and information loss.

Businesses that provide a service need to buy professional liability insurance. Check federal, state, county and local laws for legal insurance levels.

To protect your personal assets, buy more insurance than you need legally. For more coverage, buy a general liability policy along with professional liability insurance.

Do you have partners or a board of directors? If you do, you need a directors and officers policy.

See below for a complete list of policy types.

How much does general liability insurance for a small business cost?

The short answer? Less than $1,000 per year in most cases.

The “limited,” in LLC, LLP, and LP means just that, limited. The legal registration of your business shields it from some liability, but not all. Make sure you understand the level of protection you need.

Liability insurance covers the costs of harm, injury, or loss. Businesses run from home often do not have enough insurance. The right insurance protects you from losing personal and business assets.

What’s the difference between cyber insurance and general business liability insurance?

Internet criminals target small businesses. Almost half of all small businesses will fall victim to cybercrime.

Will your business be financially responsible for stolen credit card numbers? Do you know the answer? If you don’t, check your insurance policy.

If your company handles personally identifiable information (PII), you need cyber insurance. PII includes:

• social security numbers,
• credit card numbers,
• banking information,
• tax returns,
• medical information.

Cyber insurance covers the costs of cybercrime and data breach.

• Cybercrimes include hacking attacks, such as ransomware and denial of service attacks.
• A data breach happens when criminals steal PII.
• A data breach happens when employees mishandle PII.

Cyber insurance can cover:

• the legal costs related to the theft of sensitive data,
• public relations to restore a company’s reputation,
• mitigation costs,
• and prevention services.

If you think you need cyber insurance, talk to your agent.