Small Business Insurance: Managing Risk

Summary

This video advises business owners on protecting themselves from liability through insurance. It explains that accidents, losses, and negligence can make a business legally and financially responsible, which is known as liability. To defend against potential lawsuits and claims that could bankrupt a company, the video details the most common and essential business insurance policies like general liability, workers' compensation, and professional liability. It also lists specialized coverages and notes that a qualified agent can assess risks and recommend appropriate policies tailored to the unique needs of each business.

Takeaways

• 😀 Business insurance helps protect companies from financial liabilities due to accidents, injuries, losses or other disasters.
• 💡 Common types: General liability, Workers' compensation, Professional liability insurance.
• 📜 General liability covers bodily injury, property damage on business property.
• ⚙️ Workers' compensation protects employees injured on the job.
• 🤓 Professional liability protects against claims of inaccurate advice.
• 🚗 Specialized policies available like auto, property, business interruption.
• 💰 Policies help pay legal costs and settlements from lawsuits.
• 🔒 Insurance prevents financial ruin from claims exceeding business assets.
• 📃 Business Owner's Policy (BOP) bundles common coverages.
• 🤝 An insurance agent can recommend right policies and coverage levels.

Q & A

What is business insurance and why is it important?

Business insurance refers to various insurance policies designed to protect businesses from potential liabilities and losses. It is important because it helps pay for liabilities in the event of accidents, injuries, lawsuits, and other disasters that could otherwise lead to complete financial ruin for a business.

What are the three most common types of business insurance?

The three most common types of business insurance are: 1) General liability insurance, which covers bodily injury, property damage, etc. 2) Workers' compensation insurance, which protects employees injured on the job. 3) Professional liability insurance, which protects against claims of negligent advice.

What does general liability insurance cover?

General liability insurance covers bodily injury to others on your business property, physical damage to someone else's property caused by your business or employees, personal injury like libel and slander, and the costs to defend yourself in these situations.

When is workers' compensation insurance required?

Workers' compensation insurance is required by almost all states if you have any employees. It protects your business and employees in the event an employee gets injured on the job.

Who would benefit from professional liability insurance?

Professionals like real estate agents, insurance agents, financial advisors, consultants, and others who provide expert advice that could lead to financial damage if deemed inaccurate or negligent.

What is a business owner's policy?

A business owner's policy (BOP) packages common coverages like general liability, commercial property, and business interruption insurance into one simplified policy customized for small businesses.

What does commercial auto insurance cover?

Commercial auto insurance covers vehicles used for business purposes. It is similar to personal auto insurance but tailored to protect business assets and activities.

What does business interruption insurance cover?

Business interruption insurance compensates your business for a percentage of lost income if you are forced to temporarily shut down due to a covered event like natural disaster, fire, or vandalism.

Is home-based business insurance necessary?

Yes, home-based business insurance covers gaps that your standard homeowners insurance may not cover related to having a home business, like insuring specialized business equipment.

How can a small business get the right insurance coverage?

Speak with an insurance agent who specializes in small business policies. They will assess your specific liabilities and make tailored policy recommendations to protect your company.