Are you just starting a small business and are thinking about getting insurance? While we 100% support that idea and it’s better to be safe then surprised in case something unexpected happens, we also want to tell you that research is the key when it comes to insurance. You need to know just what you are getting insurance for and how it’s going to work later on, and that’s where this article steps in – we’re going to tell you everything you need to know when getting insurance for your small business, especially landscaping business.
What Exactly is Business Insurance?
First things first, let’s talk about the basics of business insurance. The purpose of business insurance is to cover and hence protect your business if you happen to be in an unfortunate event regarding the course of your business. What does that mean? Well, the “course of your business” is basically an umbrella term that covers everything from property damage and accidents to professional mistakes as well as legal fees. You can choose from many different insurance plans depending on your risk assessment, needs, and priorities, but this topic is definitely something in which you should put a lot of research, and it will be best for you to consult with different insurance companies to get the best deal at the best price. Be aware that business insurance in no way can cover everything and what does it cover will be specified in the contract. But, it should be noted that it does sometimes happen that the insurance claims aren’t handled fairly, and an expert on this topic – Doug Terry, insurance claims lawyer, says that in these cases, the business owners don’t even know their legal rights and if anything can be done when this happens, but it can be. So, all of that being said – be sure to do your research before you sign the contract with the insurance company.
Types of Business Insurance
Now, we are getting into details. As we have mentioned before, there’s a lot, and I mean, a lot of different insurance plans for small businesses. So, first of all, let’s cover the most regular situations that can happen in which you’ll benefit from having business insurance.
Commercial Property Insurance
The first and most obvious one is some sort of damage that has happened due to a disaster or a third party. So, perhaps a robbery or vandalism, or an explosion, a fire, a burst pipe, or something similar to that. In this case, you can protect yourself by having commercial property insurance. When it comes to commercial property insurance, how much will it cost you, as well as what it will cover, the plan heavily depends on your business’s circumstances.
First and foremost, what is the value of your business (value of the building itself as well as the assets that it stores)? Secondly, since this type of insurance covers natural disaster damage (well to some extent, it usually doesn’t cover earthquakes and floods!), a risk assessment will naturally play a big part when it comes to the price of your plan. So, the most important variable when it comes to risk assessment is the construction quality regarding the building that your business is in, the location because some locations are more prone to natural disasters, as well as the type of business that you operate. So basically, when all of the details are considered and you pay for your commercial property insurance, you can expect from the insurance company to cover for the building that your small business is in, as well as pretty much everything inside it (regarding property). You can buy your commercial property insurance by itself, or in a combination when you’re buying commercial liability insurance, about which we will talk next.
Commercial Liability Insurance
Okay, so now that we have covered accidents and unfortunate events, you might be wondering if there is a way to have insurance in case your business encounters a lawsuit insured by a third-party. And yes, there is, and that’s what the commercial property insurance is for basically. So, let’s say a lawsuit situation happens, what does your insurance plan cover? First of all, no matter who is at fault, it will help you with the defense costs. Then comes the help with court costs. So basically, it will help you with the entire process. But be aware that commercial liability insurance isn’t going to help you with intentional acts!
Business Owners Policy (BOP)
Now that we have talked about both the property and liability commercial insurance, we should let you know about another policy that covers both, and is hence often a way that small business owners choose to obtain their insurance. So yes, business owners’ policy is a package policy that includes both types of insurances mentioned above. It should be mentioned that it generally costs less than buying both plans individually, but it is more basic. Also, it heavily depends on the insurance company, but BOP sometimes even provides crime insurance, vehicle insurance, as well as flood insurance – all of which are usually not covered with regular commercial liability insurance. On the other hand, it doesn’t cover professional liability nor worker’s compensation.
General Liability Insurance
This type of plan is very similar to commercial liability insurance, but it does come with a few important advantages, which further makes it pricier. It does protect your business from third-party lawsuits, but it also protects you from personal and advertising injuries!
Business Auto Policy
This type of policy is going to provide you coverage for any vehicles that are registered under your business’s name, as long as anything that possibly happens to them has happened on a public road. In case you have more vehicles, it’s important to mention that while constructing a BAP plan, each vehicle is going to get the exact coverage assigned to them. And you should be careful about this, because even if the whole coverage of BAP is enough to cover the damage of severe car damage – if the cost of the repair surpasses the coverage assigned to that exact car, you will not get reimbursed.
We hope that this article has provided you with some helpful information regarding choosing your business insurance policy. In the end, the keyword when it comes to this topic is – research. Never sign a contract without fully knowing what are you getting, so, be careful, do your research, and good luck!
Founder Dinis Guarda
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