How To: Get Small Business Insurance
by: Leo Welder | ChooseWhat.com
Every business needs a general insurance policy to be protected from common liabilities.
General liability insurance protects the insured in the event he or she is sued for claims that come within the coverage of the insurance policy. Premiums for these policies are based on what type of business you’re operating and what your projected revenues are. (When we started, our premium was about $100 per month.)
A General Liability Policy Covers:
- Loss of business property (e.g. furniture, equipment, etc.). Our office got burglarized shortly after we hung our shingle, and we were able to make a claim to replace the items that were stolen with money from our general liability policy.
- Losses from litigation (including legal fees). If you get sued for something, your general liability policy should cover any losses from the suit (including legal defense).
A General Liability Policy Does Not Cover:
Your general liability insurance policy may not cover your biggest liability. Figure out the most likely scenario for which you would get sued and how you can get coverage. Examples:
If you’re a professional service company like a law firm, accounting firm or real estate brokerage firm, you could be sued for making an error that cost your client money.
If you’re a publisher, online or offline, any suit brought for defamation, trademark infringement or copyright infringement will likely be excluded from your general policy.
You can usually get an Errors and Omissions policy to cover these items. The above examples are just a couple that we’re aware of. We strongly recommend talking to a commercial insurance broker to discuss what you need and don’t need.
Before you get small business insurance, you should:
Assemble the information needed to get insurance quotes.
- Business Address
- Business Phone Number
- Business Email Address
- Legal Entity/Status
- Estimated Gross Revenues
- Your SIC Code: Standard Industry Classification codes are maintained by the SEC and identify which primary industry a company is engaged in.
- Loss History: If you’ve ever made a claim, they will want an explanation.
Search for Insurance Quotes Online
Finding quotes online is fast and easy, and you can do it yourself. Some discount carriers may not work with insurance brokers, so contacting them yourself will be the fastest and easiest way to get a quote. The only disadvantage of getting quotes yourself is that unless you’re an expert you don’t have anyone knowledgeable in your corner advising you on what to do.
Bolt Insurance Agency has a simple online form that you can fill out in order to receive quotes from eight highly-rated business insurance providers:
Bolt Insurance also offer live chat support and a toll-free support number to help you get quotes. Call for Quotes: 888-331-5948.
Hire a Commercial Insurance Broker
Insurance brokers are paid by the insurance company, so using them doesn’t cost you anything. They can help you assess areas where you might need additional insurance. They will maintain your policy for you, help you with claims and competitively bid your renewals. There are no real disadvantages to using an insurance broker. However, some discount carriers may not work with insurance brokers, so contacting them yourself will be the fastest and easiest way to get a quote.
Once you’ve narrowed your search down to a few insurance providers, you can usually contact the provider to work with one of their brokers. If you want to work with a local insurance broker, just do a quick Google search for “commercial insurance broker + your city” to find brokers in your area.
- You’ll need a sufficient general liability policy to qualify to lease office space. Most commercial leases require tenants to carry a certain amount of general liability insurance (typically $1 million). If someone sues you for something that happens in your office space, (e.g. slip and fall), your landlord will likely be named in the lawsuit. Your landlord will want to be named on your policy as additionally insured, so that he or she has coverage in the event of such a lawsuit.
- Get insured to protect yourself against lawsuit abuse. No one is going to sue a bootstrapped start up with no assets for financial gain. However, they might sue you to force you out of business before you become a viable competitor.
- It’s always cheaper to get insurance when you don’t need it. If you figure out you need insurance because a situation arises where you could use it and don’t have it, you’re too late. Then, you will have an event on your record that will make it much more difficult (typically more expensive) to get insurance.