Saving for my first apartment

Starting Your Own Business: Five Tips to Make Sure You Are Adequately Insured

If you are opening your own business, you need to ensure you have the right insurance plans in place. There are a variety of policies or coverages you need depending on the type of work you do. Here are some tips to help you get started:

1. Contact your homeowners insurance agent if you plan to work from home

Many small businesses get their start at home, and even if you aren't working from home full time, you may have an office there. If you are doing any work at home, contact your home insurance company. They can let you know if your current policy covers work-related issues. For example, if a delivery person bringing a business package to your home slips and falls, does your home insurance policy cover you from a liability standpoint or do you need a separate policy?

2. Obtain public liability coverage

If you interact directly with clients, you need public liability coverage. This type of policy covers you in the event that a customer or client sues you for their injuries or damage to their property. To illustrate, if a customer's falls in your shop and tries to hold your business financially responsible, this type of policy kicks in. However, it doesn't just work in those narrow circumstances.

To illustrate, imagine you own a catering company and during an event at a client's house, one of your staff members places a hot pan on the kitchen benchtop, scorching it. In this case, if the client tries to hold you responsible for that property damage, your public liability coverage helps you.

Specific industries often have their own unique versions of public liability insurance. For example, medical professionals typically need medical indemnity coverage.

3. Consider product liability coverage

If you produce products, you should also look into product liability coverage. Some small business insurance brokers can roll product and public liability into the same policy. If you make products (clothing, shoes, tools, toys, etc.), this policy protects you financially if a defect in your product causes damage to customers. However, this type of policy can also cover other types of products. For example, if you are a contractor and you build someone a house, this type of insurance can protect you financially from lawsuits related to issues with the home.

4. Remember your work vehicles

If you use a vehicle for work, you may need to adjust your current policy to reflect that fact. Contact your insurance broker and talk about whether or not you need third party personal injury insurance on your vehicle. Also, look into special policies if you let your employees drive your vehicle.

5. Insure your assets

Finally, if you have invested a lot of money into equipment for work, you should also insure those assets. If they are stored at your home, make sure your homeowners theft or damage policy covers them. If not, make sure that those assets are adequately covered with an affordable excess.

If you have questions about potential policies or coverage you need, make sure to contact insurance brokers in your area so you can stay protected.