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5 Things to Know About Small Business Insurance

Updated 02:08 PM EST, Tue April 2, 2019

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1. Do I Need Liability Insurance for My Small Business?

In most states, small businesses are required to carry liability insurance. Even if you’re in a state where it’s not required, having liability insurance is important as it can help protect your business.
Liability insurance is a type of small business insurance. It helps protect your business from claims of property damage, bodily injury, and personal or advertising injury.

2. What Kind of Small Business Insurance Do I Need?

Most states require businesses to carry certain types of small business insurance. But even the coverages that aren’t mandated by law could be beneficial to your business. Why? Think of small business insurance as an investment you’re making for your company to succeed and grow.
The unexpected can happen at any time. It’s best to be prepared and not leave anything to chance. Below are a few different examples of how businesses can benefit from small business insurance:
  • Technology business – The technology industry is constantly evolving. For a tech business – or any business that has customers’ personally identifiable information – a cyber liability insurance policy could help cover the costs of a data breach. For example, if you own a computer repair shop and customer information is breached after your database is hacked, cyber liability insurance can help you. This coverage can help cover the costs to notify affected customers, as well as the public relations efforts.
  • Food delivery services – If your business specializes in food delivery, chances are you’re using a car to fulfill customer orders. A commercial auto insurance policy can help cover the costs of an accident if you or an employee is found at fault. And it doesn’t just have to be a food delivery company. If your business owns, rents, leases or if you and your employees use your personal cars for business, this insurance coverage can help protect you.
  • Accounting Firms – Your accounting firm can be sued by a client if you make a mistake while providing a service. Say you’re hired to file a customer’s taxes. An error made by your firm results in the customer paying hefty fines and fees. A professional liability insurance policy can help cover the costs resulting from a claim filed by the customer.

3. How to Determine Your Business Owner’s Policy Eligibility

A business owner’s policy, also known as a BOP, is made up of three small business insurance coverages:
Commercial property insurance, also known as business property insurance, helps protect the physical location of your business. Whether you own or lease the property, it’s protected. This insurance coverage also helps cover your business property, such as tools and inventory.
Business income insurance helps replace lost income if your business can’t be opened due to a covered loss. For example, say the building your business is in is struck by lightning. You’re unable to open for business as repairs are being made. This coverage helps cover the lost income, which you can use to pay ongoing expenses.
As a business owner, consider a BOP if:
  • Your business has a physical location.
  • There’s a chance of you or your business being sued.
  • You have property that can be stolen or damaged.

4. How Much Does Small Business Insurance Cost?

What you pay for your small business insurance may be different than what another business owner pays to protect their company. The cost of small business insurance will vary from business to business. The cost is impacted by different factors, such as:
  • The industry your business is in.
  • The number of employees you have.
  • The size of your business’s payroll.
  • Claims history.

5. Know Your Business Insurance Statistics

Checking business insurance statistics from a third party, like, can be beneficial to a business owner. You can grow your knowledge of small business insurance, while also getting a better sense of what coverages you need for your business.
For example, you may find it necessary to take out a professional liability insurance policy for your accounting firm after seeing how many lawsuits are filed against accountants in the last year.

Get the Best Small Business Coverage at the Best Price

The Hartford has been helping protect businesses for over 200 years. Over 1 million small business owners throughout the country trust us to protect their businesses. We can work with you to determine what your business needs are. And we can help you find the best insurance coverage for the right price. We’re here to help you and support your small business.
To find out which insurance coverage you need for your business, get a quote today. Or call 855-829-1683 to speak with one of our specialists.

Certain coverages vary by state and may not be available to all businesses. All Hartford coverages and services described on this page may be offered by one or more of the property and casualty insurance company subsidiaries of The Hartford Financial Services Group, Inc. In TX, this insurance is written by Sentinel Insurance Company, Ltd., Hartford Casualty Insurance Company, Hartford Lloyd’s Insurance Company, Property and Casualty Insurance Company of Hartford, Hartford Underwriters Insurance Company, Twin City Fire Insurance Company, Hartford Accident and Indemnity Company and Hartford Fire Insurance Company. In CA by Sentinel Insurance Company, Ltd. (CA license # 8701) and its property and casualty insurance company affiliates, One Hartford Plaza, Hartford, CT 06155.
The Hartford® is The Hartford Financial Services Group, Inc. and its property and casualty subsidiaries, including issuing company, Hartford Fire Insurance Company. Its headquarters is in Hartford, CT.