Human and natural disasters can lead to loss, disruption, and damages in a business. One of the best ways to protect your business is through insurance. Commercial insurance protects companies, their owners, and employees. However, business insurance needs depend on the nature of your operations. Thus, it is essential to differentiate the various commercial insurance options available in the market. This article highlights five common types of commercial insurance and how they can protect your business.
What Is Commercial Insurance?
Commercial insurance is a product that offers a variety of covers for various risks in a company. The insurance protects your company from the most common losses in a business, such as liability, damage, and injury. Notably, businesses purchase commercial insurance policies through brokers and agents. Therefore, it is important to contact insurers specializing in commercial insurance.
The cost of a commercial insurance policy depends on the size and nature of business operations. For example, the insurance needs of a small-town baker would differ from those of a bread manufacturer. Besides, the insurer may consider the location, operational history, number of staff, and annual revenues in calculating insurance cost.
Types of Commercial Insurance
The ideal commercial insurance policy depends on your business risks and needs. The following are the five major types of commercial insurance policies:
1. Business Liability Insurance
This insurance policy helps a business cover damages, expenses, and fees associated with liability. Legally, injuries arising from acts of negligence can result in a lawsuit. Business liability insurance pays for such damages.
2. Business Owner's Policy
This cover combines different commercial insurance policies. For instance, it may provide coverages for property, liability, and crime risks. The business owner's policy supports an entrepreneur in managing the risk of running a business.
3. Commercial Property Insurance
The cover provides coverage for the physical assets such as buildings, equipment, and furniture. In the event of property loss and damages, the cover will meet repair or replacement costs. Thus, the insurance cover can reduce the loss resulting from the disruption of business activities.
4. Crime Insurance
This policy protects the business from losses resulting from crime. Possible acts of crime include theft and forgery by employees. Some crime insurance packages may cover cyber liability. For instance, it may cover losses related to data breaches and electronic fraud.
5. Worker's Compensation Insurance
This cover is also called workman's compensation insurance. The policy cover provides benefits to employees who are ill or suffering from a workplace injury. Essentially, worker's compensation caters to medical costs, disability benefits, funerals, and lost wages.
Every entrepreneur desires to run a business safely. However, risk management is not always a guarantee. Commercial insurance can offer peace of mind in case of eventualities.
Reach out to a commercial insurance agency for more information.