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No matter what phase of business you’re in, protecting your business against financial loss is always a priority. Business insurance can help ensure you keep your hard-earned profits where they belong. If you have questions about insurance for your small business, look no further. We have answers to the top questions asked by business owners so you can keep your business and financial assets protected. Who Needs Small Business Insurance? Small business insurance protects small businesses across every industry, including freelancers, e-commerce merchants, and any small business. The Small Business Association (SBA) defines a small business as a for-profit business that meets certain requirements for annual receipts and the number of employees. While that standard varies across industries [https://www.sba.gov/document/support-table-size-standards], the typical threshold for small businesses is fewer than 1,500 employees and a maximum of $38.5 million in average annual receipts. Sole proprietors, LLCs, and corporations can all be considered “small businesses.” There is no such thing as “too small” for insurance; if you are operating a business, you can benefit from the risk-protective benefits of small business insurance. Why Do I Need Small Business Insurance? When you run a business, you risk lawsuits and financial losses resulting from your business operations. Imagine if a customer slipped and fell on the floor of your coffee shop, resulting in large medical bills. Or if the delivery person for your flower business crashed your business vehicle into another car while making their delivery rounds. Your products could injure a customer, or your consulting advice could lead to a client’s financial loss. There are a million different ways your business operations could lead to injury, property damage, financial loss, or even a data breach. Small business insurance can help protect your finances in the event of an unexpected or unforeseen incident, helping you keep your hard-earned money in your bank account. In some cases, small business insurance could help protect your personal assets, too. For example, if you’ve structured your business as a sole proprietorship, you could be personally liable for your business's debts, losses, and liabilities. There is no legal separation between you and your business. Debts, liabilities, and losses stay with your business for some LLCs and corporations. But one slip and fall claim or accident could mean the difference between keeping your doors open or closing up shop for good. What Insurance Does My Small Business Need? There are a number of insurance policies designed to protect your small business. While your insurance needs may vary depending on your type of business and industry, below are the most common types of insurance policies that any business would need in order to be protected. General liability is a type of business coverage that covers third-party injuries, property damage, and advertising injuries, including claims for libel, slander, and copyright infringement. That slip and fall accident at your shop is included in this coverage: general liability is designed to cover the medical and legal costs associated with someone getting injured as a result of your business operations. Professional liability is a type of business insurance that’s meant to protect you against claims that your service, advice, or consultation resulted in a financial loss for your client. Professional liability is also known as errors and omissions (E&O) coverage, and it’s meant to cover legal costs and claims if a client alleges that your mistakes, omissions, or oversight resulted in a financial loss. Product liability is a business insurance policy designed to protect you as the manufacturer or seller of a product. If a client is injured as a result of your product, then you’ll want this coverage in place to help cover the costs associated with a claim for a defective product that you make or sell. It helps ensure you won’t have to pay out of pocket for medical bills, legal fees, and any judgments or settlements from a defective product lawsuit. BOP (business owners policy) is a cost-effective way to bundle together multiple business insurance policies for one lower price. BOPs typically combine general liability with commercial property coverage, however, you may be able to tailor a BOP and add additional coverages for your business. By bundling separate policies into one BOP package, business owners typically pay less than if purchasing these as separate policies. Cyber liability insurance is designed for business owners who handle sensitive information, such as customer information, credit card numbers, or sensitive client information. Cyber liability is intended to cover the costs of credit monitoring, notifying customers of a breach, legal fees, and reputational damage if your business ends up in a data loss/ data breach situation. Workers compensation insurance is designed to protect the hardworking people who help your business grow and succeed. Workers’ comp covers your employees’ illness or injury if they get sick or hurt while performing their jobs. While many business insurance policies are optional, workers compensation is one of the few types of coverage required by law in most states. If you hire any employees, whether part-time or full-time, you’re likely required to cover them with workers compensation insurance. See a state-by-state guide to workers’ comp requirements. [https://www.nfib.com/content/legal-compliance/legal/workers-compensation-laws-state-by-state-comparison-57181/] Is Insurance Required To Run My Small Business? Like we mentioned above, some insurance policies are required to operate your small business. Workers’ compensation, for example, is required by law in nearly every state if you have employees or if you are an owner on the business payroll. Other policies, such as general liability insurance, may be required in certain instances. * A client may require you to carry general liability coverage in order to bid on a job * A jobs platform like Fiverr may require you to carry GL in order to list your services * An ecommerce platform like Amazon or Walmart may require you to carry GL to sell online In other instances, you may be “required” to carry business insurance if you want to be covered for a claim. For example, if you are using your personal auto for business purposes, you’ll need to have commercial auto coverage to cover any accidents or injuries that result from you driving for business purposes. If you are involved in an auto accident while using your business-owned vehicle, or if you or an employee is driving your vehicle for business purposes, your personal auto coverage will not cover your claim. Where Do I Find Small Business Insurance? Shopping for small business insurance can often feel overwhelming. Where do you start? Coverdash specializes in insurance for small business owners, freelancers, and ecommerce businesses. Our small business professionals shop through insurance products from top-rated carriers in order to find the right coverage for your specific operation at rates your small business can afford. Our entire team is dedicated to helping protect your small business as you grow and scale, so you can focus on what’s coming next for your team rather than worrying about one accident, injury, or unexpected event sending you off track. Request a quote for business insurance from Coverdash and start protecting your small business today.