Q: What happens if I don’t have small business insurance?

A: Though you may not experience a loss or lawsuit as soon as you open your doors for business, the reality is that you don’t know what the future holds. A devastating accident or disaster may be years down the road or just a day away.

Plus, business insurance is a necessity if you need to get a business license or sign a commercial lease. If you offer professional services, clients often won’t work with uninsured businesses because it leaves them no recourse if they experience losses as a result of your work.

Finally, your state may require you to carry specific types of insurance, such as Workers’ Compensation Insurance (if you have employees).

The Gamble of Leaving Your Business Uninsured: Details

When you’re just starting out your business, insurance may seem like an unnecessary expense. You’re trying to get clients and customers through the door! You’re not worried about what might go wrong after that.

But here’s the thing: you often need insurance to get your business off the ground. Acquiring insurance for your small business allows you to…

  • Apply for licenses. That’s because many licensing bodies consider an active insurance policy a requirement of becoming licensed.
  • Sign a lease. Your landlord may require you to have General Liability Insurance and Commercial Property Insurance.
  • Attract big client contracts. Clients may require you to have Professional Liability Insurance (aka Errors & Omissions Insurance) or some kind of commercial liability coverage.
  • Hire employees. Most state laws stipulate that you carry adequate Workers’ Comp coverage. (To learn what your state requires, check out, “Workers’ Compensation Laws by State.”)
  • Buy commercial real estate or expensive equipment. Damaged property or equipment can be easily covered with adequate Property Insurance.

And that’s just scratching the surface. If you want to chat about your potential coverage obligations with an agent who specializes in your industry, contact us at 800.688.1984.

Small Business Insurance Protects Your Livelihood

You’ve put a lot of effort into building your business. Purchasing small business insurance ensures you’re able to stay afloat when unexpected events threaten to drain your finances.

You can be the most careful small-business owner in the world and still face a lawsuit or devastating property damage. Some things are simply beyond your control. Consider this:

  • You could be sued when a visitor is injured on your business property. It only takes one slick spot on the floor sending someone to the ER with a concussion to deplete your savings – and then some.
  • A fire could destroy your office space. All your equipment, inventory, furniture, fixtures, and supplies? Gone or facing irreparable damage.
  • You could be sued even when you’ve done nothing wrong. Frivolous lawsuits are almost inevitable in this country, as many small-business owners know all too well. Check out this helpful infographic by AboveTheLaw.com to learn more about America’s obsession with lawsuits. Unfortunately, even a dismissed lawsuit will run you a cool $2,000 - $5,000 in lawyer fees.

Think of adequate commercial insurance as a financial safety net when these unpredictable (and sometimes unfounded) occurrences hit you out of the blue. If something doesn’t go according to plan, you have the means to handle whatever comes your way.

Small Business Insurance: Big Benefits, Small Costs

Compared to the cost of a lawsuit (which can be millions) or extensive property loss (which can threaten the survival of your business), commercial coverage rates are small beans indeed. But you can keep your premiums reasonable by…

  • Working with an agent who specializes in your industry. They can find products designed for businesses like yours, which means you won’t have to worry about paying for unnecessary coverages.
  • Asking about a Business Owner’s Policy. This insurance bundle allows you to purchase General Liability and Property Insurance together at a reduced rate.
  • Developing a risk management plan. Insurance providers may offer discounts based on the mitigation strategies you have in place (e.g., security cameras in your shop or contracts with clients).

You’ve worked too hard to leave your business’s future to chance. Fill out an online insurance application today, and we’ll connect you with an industry-specialist agent who can tailor your policies to your business’s risks.

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