Starting a new company and watching it grow is exciting. But as I’ve said before, there are definite risks involved and you will need a custom package of insurance coverage which offers broad protection.
Your business’s first comprehensive insurance risk analysis should be made when the venture is launched, relying on the talents and knowledge of both your experienced legal counsel, and a savvy insurance broker. Once you have your insurance “book” in place, you, your lawyer, and your broker should have periodic reviews and coverage updates, particularly at key points and changes in the company’s operation.
One of the most important times to have an insurance checkup is when your business moves into a new or different location. Regardless of whether you are renting or buying, your company must carry certain kinds of business insurance.
There is a wide range of insurance coverage available that can be tailored to meet your company’s needs, and the primary categories are: business property, general liability, professional liability, product liability, business interruption, completed operations, and workers’ compensation insurance. Below, I’ve tried to give you a short overview of what these various policies do and how they work together to insulate you (and your money) from unexpected losses.
Business Property Coverage
Business property insurance coverage includes protection for the real property your business owns or rents. It also covers damage and loss (including from criminal activity) to “your stuff”; that is, the contents located at the premises that your company occupies, or at locations it leases from others. Covered contents should include your equipment, supplies, inventory, and finished goods and products.
General Liability Insurance (a.k.a. “CGL”)
General liability protection covers claims related to persons who might injure themselves while at your office, shop, or premises. No matter how safe you keep your space, there is always a risk of being sued. Your coverage should include, at the very least, a comprehensive general liability policy. Your landlord will most likely require this also under your lease.
Professional Liability Insurance
This type of coverage, also called “errors and omissions” insurance, protects professionals such as corporate board members from financial loss associated with negligence: giving bad professional advice, treatment, or service.
Product Liability Insurance
This coverage offers protection to companies that make or sell a product that potentially could injure a customer or could damages property. The amount of coverage your business needs should be proportionate to the potential risk of your product.
Business Interruption Coverage
This is protection against income loss if your business must shut down temporarily because of damage. It is very common to see this “business interruption” coverage to be required by your landlord under the terms of a commercial lease.
Completed Operations Insurance
Completed operations insurance covers a contractor’s liability for injuries or property damage suffered by third parties as a result of the contractor completing an operation. This insurance helps cover your business assets because it makes the contractor accountable for taking reasonable steps in rendering a project safe and free from all reasonable hazards.
Workers’ Compensation Insurance
If you have employees, you will need workers’ compensation insurance. This is mandatory in almost every state, and every state has its own rules to comply with. “Worker’s Comp” simply put, is there to protect your company from claims by employees who are injured on the job.
If you would like legal counsel to provide you with insurance risk assessment and liability advice, contact the Law Office of Brandon Woodward P.A. for assistance. We offer a FREE consultation, and will do everything we can to help you protect yourself and your business.
The Law Office of Brandon Woodward P.A. is eternally grateful that you have visited our web site or read our blog. The materials and information contained here are provided for informational purposes only and are not to be considered as legal advice. For questions about business contracts or any other legal issues facing your business, please a message us at firstname.lastname@example.org and we’ll give you a totally FREE consultation.