If you’re a commercial business owner or are in the market to become one, you’ve probably heard the term “commercial insurance” once or ten thousand times already. But what IS commercial insurance? What does commercial insurance do for you as a business owner? Are you required to have commercial insurance? If so, what are your options?
The list of questions may feel neverending, but we’re here to tell you some basic things you need to know about commercial insurance and how to use it.
What is Commercial Insurance?
Commercial insurance is insurance for businesses and corporations, generally designed to cover the business attributes, employees, and ownership. Since every business is unique with different needs and situations, commercial insurance can come in many shapes and sizes.
This specific type of insurance is more of an investment that will help you in the long run, so it’s something you, as a business owner, should ensure you have early on in your business timeline.
Types of Commercial Insurance
There are two main types of commercial insurance: commercial property insurance and business liability insurance.
Commercial property insurance pays to repair or replace stolen, lost, or damaged business property. It covers your business’s physical location and other assets such as equipment. Most landlords will often require proof of a business’s commercial property insurance from their business tenants.
Although a landlord may have commercial insurance to cover their building and property, they will not take responsibility for their tenants’ personal business property. Even if it’s not required, commercial property insurance is beneficial for all small businesses as this coverage insures expensive equipment and inventory.
Business liability insurance is any type of small business insurance that protects against accusations that your business caused damages, injuries, or losses. Business liability insurance provides crucial protection against the high cost of lawsuits and also helps business owners secure leases and contracts.
Liability Insurance helps pay for:
- Customer injuries at your shop or office
- Accidental damage to customer property
- Advertising that damages a competitor
- Mistakes that harm a client financially
- Incidents related to alcohol consumption if you serve drinks
Why is it Important?
Getting yourself and your business commercial insurance is extremely important for many reasons. The biggest reason being you can’t get the ball rolling on much with your business until you have this. You typically will need commercial insurance to:
- Own or rent a business building
- Own or rent expensive equipment or tools
- Have products or inventory
You typically need liability insurance to:
- Sign a lease
- Get properly Licensed
- Fulfill the terms of a contract
- Comply with state laws
To move forward with these things, and others, start with getting your business commercial insurance and liability insurance. You never know when disaster could strike or your valuables could get stolen – but if those things ever do happen you can count on your commercial insurance to have your back.