Types of Small Business Insurance (2024)

What Types of Insurance Does a Small Business Owner Need?

If you’re asking yourself “do I need insurance for my small business?" the answer is yes. Every business owner needs small business insuranceto help protect their company from risk. But how do you choose the right coverages? At minimum, you should start with these types of small business insurance:

• General liability coverage
• Workers’ compensation coverage
• Commercial autocoverage

You’ll also want to think about what you use to keep your business running, like tools and equipment. Certain coverages can help protect these belongings. To learn more, call our specialists at 855-829-1683. They’ll help walk you through the right coverages and limits for your company.

Basic BusinessInsurance Needed for Small Business

The average customer injury or property damage claim is $30,000.¹That’s why aBusiness Owner’s Policy(BOP) is helpful for many companies.

This policy combines business property and business liability insuranceinto one. We can then help you customize it to fill in any gaps that your BOP doesn’t cover. You can count on us to make sure you’re prepared for accidents, liability lawsuits and damaging weather that comes your way.

Types of Small Business Insurance Coverages

General Liability Insurance

General liability insurancecan help protect your business from claims of bodily injury or property damage. They can also help cover tortfeasor claimssuch as libel and slander.

For example, if a customer slips and falls while shopping in your store, this coverage can help pay for their medical bills. Without it, you’ll have to pay these costs out of pocket.

Commercial Property Insurance

• Tools
• Equipment
• Inventory
• Furniture

For example, if a fire damages your office building, this coverage can help replace your equipment inside.

Business Income Insurance

Business income insurancehelps replace lost income from fire, wind damage, theft and other covered losses. So, if you have to temporarily shut-down your restaurant due to a fire, this coverage can help pay your lost revenue.

Workers’ Compensation Insurance

Workers’ compensation insurancehelps provide benefits to your employees if they have a work-related injury or illness. This coverage helps pay for:

• Medical care
• Lost wages if your employees need time off to recover
• Disability benefits
• Funeral expenses

So, if your employee lifts too many heavy boxes and gets tendonitis, this coverage can help pay for their medical treatment.

Commercial Auto Insurance

If you have employees that drive for your business, you’ll want commercial auto insurance. This policy helps cover accidents if you or your employees are at-fault. For example, if your worker is using your company’s van for deliveries and accidently hits a customer’s car while leaving your business, this coverage can help pay for the damages.

This insurance is especially important if your business:

• Has workers that drive leased, rented or owned company vehicles
• Owns, leases or rents vehicles
• Has employees that drive their own cars for their job

Professional Liability Insurance

For example, if your employee gives a client financial advice that causes them to lose money instead of gaining it, your customer may sue you for negligence. This coverage can help pay your legal fees.

Data Breach Insurance

Most small businesses store important personal information for their customers and clients. To help keep it safe from hackers, you’ll need data breach insurance. For example, if your computer gets a virus that steals important customer information, this coverage can help pay to:

• Notify impacted customers, patients or employees
• Hire a public relations firm
• Offer credit monitoring services to data breach victims

Do I Need Liability Insurance for My Small Business?

Every small business faces certain hazards and risks. To help protect your business, you’ll need to get the right liability insurance for small business, including:

• General liability insurance for small business
• Professional liability insurance
• Employment practices liability insurance
• Management liability insurance
• Cyber liability insurance

Benefits of Packaging Different Types of Small Business Insurance

We can help yousave money on business insurance costs by offering a packaged policy. For example, you can bundle these three insurance coverages into one with our Business Owners’ Policy (BOP):

• General liability insurance
• Business income insurance
• Commercial property insurance

We also offer packaged policies for various industries. For example, if you want comprehensive coverage for your dental practice, we offer dental office insurance.

What Is a Small Business Owner’s Policy (BOP)?

Packaged policies, like a BOP allow you to protect your business from:

• Property damage
• Lost income
• Liability claims

This policy gives small business owners a good start toward protecting the business they’ve worked so hard to build.The cost of insurance for a startup business will vary depending on a few factors.

Last Updated: August 14, 2023

¹ Based on an analysis of five years of claims data (2010-2014) from more than 1 million Hartford Business Owner’s Policies.

Additional disclosures below.