These two words are enough to strike fear into the hearts of many a small business owner. And rightfully so – if you own a business, chances are you’ve had to go through the process of finding the proper kinds of business insurance, and you know this can be a daunting task.
So many different factors enter into the decision on which types of coverage you need, and what your coverage amounts should be. Plus, there are so many different types of coverage out there, how can you be sure you’re getting what you need, if you don’t know exactly what’s available to you?
It’s always advisable to work with a trusted, seasoned insurance professional, who can make sure you’re always on the right track, but even so, one of the best things you can do, is educate yourself. When it comes to business insurance, ignorance is not bliss!
To start you off on your journey, here are a few examples of some little-known types of insurance and why you might want to consider purchasing them.
Employment Practices Liability Insurance (EPLI)
EPLI covers liabilities that can occur within the employment process. Claims filed by employees such as those for wrongful termination, discrimination, sexual harassment, or other civil or legal rights can be covered. Other types of inappropriate workplace conduct can be covered, such as defamation, invasion of privacy, deprivation of a career opportunity. EPLI insurance can cover the judgement for which the insured is liable for, as well as other legal defense costs.
Home Business Insurance
If you’re running your business out of your home, be sure to look into Home Business Insurance. Most of the time, a typical homeowner’s insurance policy won’t cover certain types of claims that can arise if you’re operating a business out of your house. Some scenarios that you may want to consider when deciding if you need Home Business Insurance include loss of inventory, giving advice that costs a customer money, or injury to someone on your property.
Often times, Terrorism Insurance can be written into basic commercial property or other types of commercial insurance policies, but not always. It’s not a bad idea to check your existing policies and review them to make sure you have this coverage, or to make sure you have enough coverage – some types of business can have a higher risk of terrorist activity than others.
Income Stabilization Weather Insurance
We’re all familiar with insurance that covers natural disasters – but weather doesn’t have to be extreme to still cause damage or loss to a business.
Many businesses can have seasonal sales patterns, and often these can be at the mercy of the weather. For example, if an area of the country which normally sees heavy winter snowfall happens to have an unusually warm winter, this could harm sales of business that rely on that snowfall.
Cyber Liability Insurance
Cyber Liability Insurance, or Cyber and Privacy Insurance, can be a necessity for companies who engage in activities such as selling goods or services on the internet, or who collect customer data within their own electronic network.
This type of insurance protects businesses against losses caused by data breaches, where customers’ personal information such as social security or credit card numbers, are stolen by hackers. Insurance can help cover the resulting costs incurred by customer notification, credit monitoring, claims filed by state regulators, fines, etc.
Cyber Insurance can also cover other costs that may result from a company’s web site being hacked, such as interruption to business and fraud.
Directors and Officers Liability Insurance
Directors and Officers Liability Insurance, or D&O, protects directors and officers of a company or organization against legal action resulting from alleged wrongful acts or claims of mismanagement. D&O Insurance will not only pay for the judgement if the insured is found to be legally liable (up to the policy limits), but also the resulting legal defense costs.
As mentioned at the outset, it’s always advisable and preferred to work with an Insurance Agent or Broker whom you trust and has experience with your line of business. But that’s no substitute for arming yourself with knowledge. By making sure you’re aware of the different types of business insurance coverage that may be available to you and your business, you’re simply doing the smart thing, and ensuring that everything you’ve worked so hard to build up, is properly protected.