10 Types of Liability Insurance Every Small Business Should Consider

Liability Insurance is the Bedrock of a Small Businesses Shield of Protection

Liability Insurance is a way businesses can go about protecting itself from liabilities the business faces that are beyond the funds the business has on hand to cover. General Liability is required by law for most businesses in most states, but this is usually not the only type of liability insurance coverage a business should secure. Partnering with an experienced insurance professional with whom you trust is the first step to properly protecting a small business. This professional can help advise a business owner just what types of risks they face and just what types of insurance policies they should secure. Here are 10 types of liability insurance coverage every small business owner should consider securing.

Small Business Liability Insurance Coverage

General Liability Insurance Coverage

General Liability Insurance is required by law in most states and protects a business from lawsuits, bodily injury, property damage, personal injury and completed work. Two components are included in general liability insurance. Those two components are public and product liability. Public liability protects a business from third-parties filing suit against a business. The suit can be for something as simple as the third party slipped and fell in your store. No matter how trivial the suit is, it can amount to an enormous legal bill to protect the reputation of a business. Product liability protects a business for products or completed work. When a business makes or sells a product, the business is responsible for what happens with those products. It is important to remember product liability does not provide coverage for claims of defective or faulty design alone unless that defect causes injury or damage.

Professional Liability Insurance

Professional Liability Insurance Coverage is also frequently referred to as Errors and Omissions, E&O, or Medical Malpractice. Professional Liability covers a business for financial losses suffered by third-parties due to professional advice given by the insured. The types of professionals who need this type of coverage include: Accountants, Attorneys, Real Estate Brokers, Consultants, Physicians, Architects, and Engineers. A Professional Liability Insurance Policy does not cover bodily injury or property damage, these claims are usually covered by a general liability policy.

Cyber Liability Insurance Coverage

Cyber Liability Insurance is a type of liability that protects a business from the liability the business faces to third parties for a data breach that occurs within the organization. Cyber Liability Insurance covers the costs associated with the liability of a claim or suit related to a data breach, but it does not cover the first party damages to the business.

Dram Shop Liability Insurance

Dram Shop Insurance Coverage applies to businesses that sell and serve alcohol. A Dram Shop Liability Insurance covers a business for personal injury caused by an intoxicated customer. Dram Shop Liability grew from laws passed dealing with the actions of intoxicated patrons who were served when the business knew the patron was severely intoxicated. According to Vernet v. Serrano-Torres, 566 F.3d 254 (1st Cir. P.R. 2009), it was held that the theory of dram-shop liability has been described as one where a bar or tavern may be liable for the wrongful or injurious actions of a patron, if it served alcohol to that patron after it knew, or should have known, that the patron was already intoxicated.

Directors and Officers Liability Insurance is a type of liability insurance that is paid out to the officers and directors of a company or organization, as reimbursement for losses or advancement for defense costs in the event an insured faces a lawsuit as a result of alleged wrongful acts in the officers or directors capacity as a leader of the organization. Directors and Officers of a corporation or a non-profit may be liable for damages if they damage the organization in breach of their legal duty, if they mix personal and business assets, or if they fail to disclose any and all conflicts of interest.

Employer Liability Insurance Coverage

Employer Liability Insurance is an extremely important part of every businesses workers compensation insurance. Workers’ compensation pays a workers medical costs and some lost wages if they are hurt while on the job. If an employee feels their workers compensation benefit has not provided them enough, they can sue a business for damages. Some of those damages and the legal fees associated with those suits are covered under an employer liability insurance policy.

Product Liability Insurance

Product Liability Insurance Coverage protects a business from lawsuits that result from injuries, illnesses, or property damage linked to a product made by a business. These damages include manufacturing error, faulty design, malfunctions, and even misuse. This applies to manufactured products no matter if they are simple or complex.

Umbrella Liability Insurance Coverage

An Umbrella Insurance Policy is a type of coverage that sits on top of other existing policies. When there is a covered loss and the limits of that policy are met, the Umbrella Policy kicks in to cover additional costs up to the limits of the Umbrella Policy. They key part of this policy to understand is that the claim causing the loss has to be a covered loss. An Umbrella Insurance Policy does not cover additional losses that are not covered. The policy only kicks in when the limits of an existing policy are met.

Employment Practices Liability Insurance

Employment Practices Liability Insurance (EPLI) can protect a business in the event the business faces a lawsuits related to hiring, employing, and terminating employees. EPLI can protect a business when someone files a claim due to misconduct or violation of labor laws. These lawsuits could include claims of employee discrimination, wrongful termination, discrimination (age, racial, gender), breach of contract, sexual harrassment, or emotional distress.

Business Owner’s Policy (BOP)

Businesses can package all of the necessary liability policies in to a Business Owner’s Policy (BOP). A BOP includes several different policies.  They are usually designed for a specific industry because a carriers uses historical claims data to know which types of claims are common for businesses within a particular industry. BOP’s can be altered to meet the needs of a business and the level of risk a business owner is willing to take and most times carriers will offer a discount for buying multiple policies in one package.

3 Types of Liability Insurance Every Technology Company Should Have?

General, Professional, and Cyber Liability Insurance

Technology Companies have enormous risks. Those risks depend upon whether the business sells or services technology products. Some businesses store data about the businesses customers. Other businesses create technology that other businesses use to store the data of those customers. No matter what type of risk a business faces, there are three types of liability insurance all technology companies should secure. Those policies are General, Professional, and Cyber Liability Insurance.

Technology Liability Insurance

General Liability Insurance

General Liability Insurance for Small Business is the most important type of insurance policy a company can secure.  General Liability Insurance helps policyholders from the third party risks associated with lawsuits and other types of claims. Those claims include bodily injury and property damage that is caused by direct or indirect actions of the insured. For most businesses a general liability claim can be for something as simple as a customer slipping on wet floors inside a restaurant or when when a product sold breaks and causes an injury. For technology companies, General Liability Insurance will cover legal expenses when a business is sued for customer injuries, property damage, and slander. For many within the insurance industry, general liability insurance is referred to as the first line of defense for a business. It should not be the only coverage a business secures.

Professional Liability Insurance

Professional Liability Insurance is also referred to as Errors and Omissions Insurance. Professional Liability Insurance is coverage for professional businesses that give expert advice or provide technology services for a fee. The coverage prevents businesses from bearing the full cost of defending against a negligence claim made by a client, and damages awarded in a civil lawsuit.

Here are five types of claims that are commonly covered by a Professional Liability Insurance Policy:

  • Breach of Contract: Breach of Contract that occurs when one or both parties do not live up to a contract that was previously agreed upon.
  • Fraud: Fraud occurs when one party intentionally lies or deceives for financial or personal gain.
  • Negligence: Negligence occurs when one party fails to use reasonable care that results in damage or harm to another person, business, or organization.
  • Breach of Warranty: Breach of Promise occurs when a person or business promises something to a customer in a warranty, and the business is unable to keep the promise made by the product or contract.
  • Misrepresentation: Misrepresentation occurs when a person or business makes a false claim to convince another person or party into a contract.

Cyber Liability Insurance

Cyber Liability Insurance covers the insureds liability for damages that result from a data breach. It does not cover immediate response costs that a business faces after a data breach. A Cyber Liability Insurance Policy is a type of insurance that protects businesses that sell and service technology. A data breach can result from something as small as an employees laptop being stolen while going to the bathroom at a coffee shop, but it can also result from an employee clicking on a phishing email. Data breaches are no longer just a problem for bug businesses. Both the Target and Home Depot Data Breaches started by hackers first accessing the computer systems of a small business who were partners with the bigger business. As most enterprise level business take cyber security more seriously, this is becoming a much more common way for businesses to become victims of a data breach.

What Insurance do Bars, Taverns and Restaurants need?

Bars, Taverns and Restaurants

Small Businesses in the Bars, Taverns and Restaurant Industry have many different risks that are unique to this industry. The difference between a dive bar and a four star restaurant are as different as a beauty salon and a gun club. There are different classification codes for different types of insurance coverage depending upon the operations of your business. This is because the risks of a coffee shop, is different from the risks of a cafe or a wine bar. Which classification code the business is classified in is a large part of what determines how much they pay for commercial insurance. This may determine whether the business wants to offer a certain type of food or service depending upon how much it will impact what the business pays for commercial insurance.

Overhead picture of a Restaurant.

Alcohol Consumption

Most states determine if a business is a restaurant (not a bar or tavern) if it makes a certain percentage of its revenue from food and not from alcohol sales. The typical amount to be determined a restaurant is less than 50%. If the business makes more than 50% of its revenue from alcohol sales it is a riskier business and is thus places in a riskier classification code. This causes the business to be charged a higher premium for commercial insurance. The next main factor that impacts a restaurants rate for commercial insurance is whether the restaurant offers alcohol or not at all. If the business does not offer alcohol at all, they obviously eliminate the risk of intoxicated customers. This lowers the most costly risk a bar tavern or restaurant faces.  Also, an additional factor in the amount of premium is if the business does offer alcohol, whether or not the business offers hard alcohol or just beer and wine. Hard alcohol causes intoxication at a faster rate, because of this the business is more likely to have problems related to alcohol consumption.

Picture of a bar or tavern.

Hours of Operation

Aside from alcohol consumption the next largest risk that faces Bars, Taverns and Restaurant is the hours of operation. There is much less risk in a diner open from 6:00 AM –  1:00 PM, compared to a bar that serves no food and stays open until 2:00 AM 7 days a week. The latter might carry a few more risks that might turn in to insurance claims. Because of this risk the business is going to pay more in premium for their commercial insurance. Limiting these risks before they turn in to insurance claims can save your business immensely over the long term.

Picture of a table with breakfast food and a laptop.

Types of Coverage for Bars, Taverns and Restaurant

Most insurance carriers have business owner’s packages designed specifically for Bars, Taverns and Restaurants. Here are some common coverages you will find included in those packages.

  • General Liability
  • Liquor Liability
  • Commercial Property
  • Business Personal Property
  • Workers Compensation
  • Business Income and Expense Coverage
  • Commercial Crime Coverage
  • Umbrella Coverage

General Liability Insurance covers a business for common slips and falls that happen on the property, Liquor Liability is required by law in most states and the amount of coverage is usually determined by the amount and type of alcohol a restaurant serves. Commercial Property Insurance covers damages to the building and most fixtures attached to the building. Workers’ Compensation is required by law in nearly every state and is coverage to prevent lawsuits for injuries that occur to your employees as part of normal business operations. Business Income and Expense Coverage is an addition to a Commercial Property Policy and will cover your business for loss of revenue due to being closed after damage to your premises. Commercial Crime Coverage will cover your business for crimes committed by your employees while acting on behalf of the company.  Umbrella Coverage is designed to extend the limits of existing policies when those limits have been met. It is important to note that Umbrella Policies only kick in on top of other existing policies. If the cause of the damage is not a covered peril than the Umbrella Policy will not be activated.

 

Below is a list of all the classification codes that might be included as a Restaurant, Bar or Tavern.

Business ISO General Liability:

  • Code: 16920- Restaurant- alcohol sales >75%- Table service, dance floor
  • Code: 16921- Restaurant- alcohol sales >75%- No table service, but dance floor
  • Code: 16930- Restaurant- alcohol sales >75%- Table service, no dance floor
  • Code: 16931- Restaurant- alcohol sales >75%- No table service, no dance floor
  • Code: 16940- Restaurant- alcohol sales >75%- Bar service only, with dance floor
  • Code: 16941- Restaurant- alcohol sales >75%- Bar service only, no dance floor

NCCI Class Codes:

  • 9082 – Traditional Restaurant.
  • 9083 – Fast Food Restaurant
  • 9058 – Restaurants owned or operated in a hotel.
  • 9084 – Restaurant who receives more than 50% of their revenue from the sale of alcohol.

 

 

Medical Offices

6 Types of Insurance Coverage every Medical Office Needs

Medical Offices have many unique risks to deal with. The fact that customers are in some cases sick can ad to the frequency and severity of commercial insurance claims. The fact that employees have to spend a large portion of the day on their feet can ad to the amount of injuries if the staff are not in good physical condition. Because of the unique risks faced by medical offices there are certain types of insurance that are necessary. Here is a list of six recommended types of insurance every office should secure.

Medical Offices need Commercial Insurance. Get the best answers to your small business insurance questions at My Insurance Question.com

Minimum recommended coverage:

  • General Liability
  • Medical Malpractice—Professional Liability
  • Property Insurance
  • Commercial Auto
  • Hired and Non-Owned Auto
  • Workers Compensation

 

General Liability

General Liability Insurance is a necessity for a medical office because of the amount of clients coming in and out of the property. General Liability will protect your business from injuries that occur to customers and other third parties that come in contact with your property. The fact that some of the customers are sick can contribute to more risk of other customers becoming sick due to contact with ill patients. Like in most industries that face the public regularly; slips trips and falls are always a risk. Having a safety committee and documenting their activities can help you save in the long run.

Medical Malpractice—Professional Liability

Medical Malpractice is a form of Professional Liability that is unique to the medical profession.  According to the Insurance and Risk Management Institute, professional liability is defined as:

‘A type of liability coverage designed to protect traditional professionals (e.g., accountants, attorneys) and quasi-professionals (e.g., real estate brokers, consultants) against liability incurred as a result of errors and omissions in performing their professional services’.

Conversely, medical malpractice coverage is defined as:

‘Coverage for the acts, errors, and omissions of physicians and surgeons, encompassing physicians professional liability insurance, hospital professional liability (HPL) insurance, and allied healthcare (e.g., nurses) professional liability insurance’.

In laymens’ terms, this coverage protects doctors and nurses from the liability they face regarding they face giving specialized services and advice related to the healthcare profession.  This coverage is a necessity to any business offering medical advice and services.

Commercial Property Insurance

If the business owns the location where it operates, then the business has a need for Commercial Property Insurance. This insurance coverage is very specific and it is different than a traditional home owners policy. The policy can be written on a replacement level value or on a prearranged value agreed upon by the insurer and the insured. Partnering with an independent insurance agent to determine which type of coverage you need is a wise decision.

Business Auto Insurance

If your business owns and operates any vehicles as a part of the business operation, than it needs to secure business auto insurance. Any time that an employee is using a vehicle for business purposes, the liability to third parties is the liability of the business and not the liability of the employee. This means if an employee gets in to a wreck while on the job, the damages to third party vehicles is the responsibility of the business. Now if you have employees who drive their own cars for business purposes you will need a separate policy called a Hired and Non-owned Auto Policy.

Hired and Non-Owned Auto (full commercial auto if vehicles owned)

Hired and Non-Owned Auto Insurance is needed for two main reasons. If a business has employees who use their personal vehicles for business purposes or if employees drive rented vehicles while they are doing something related to their work. This policy is in addition to the insurance coverage you may buy from a rental agency. Hired and Non-owned auto will cover your business for the liability it faces to third parties who may have property or bodily-=injury claims as a result of an accident involving an employee.

Workers Compensation

Workers Compensation Risks are unique for several different reasons. First and foremost the employees are interacting with sick patients in many situations. Spending long hours on your feet can be taxing for nurses and doctors. Encouraging the staff to live a healthy lifestyle can help limit the amount of severe claims due to wear and tear

Medical Offices

 

Physicians Liability Classification Codes

Commercial insurance companies use various liability classification systems in order to classify and rate coverage premiums for Physicians. Here are the most common business insurance classifications for Medical Clinics:

Business Liability Category: Health Care Providers

SIC Business Insurance Codes:

  • 8011: Offices and Clinics of Doctors of Medicine
  • 8042: Offices and Clinics of Optometrists
  • 8031: Offices and Clinics of Osteopathy
  • 8021: Offices and Clinics of Dentists

NAICS Liability Classifications:

  • 621111: Office of Physicians (Non Mental Health)
  • 621320: Office of Optometrists
  • 621320: Office of Dentists
  • 621498: All Other Outpatient Care Centers
  • 621330: Office of Mental Health Practitioners
  • 621399: Office of Other Health Practitioners

Business ISO General Liability:

  • 66561: Medical Office

Common Workers Compensation Class Codes:

  • 8832: Doctors, Physicians and Office Staff

Claims Made Vs Occurrence

Have you ever wondered what the differences are between a Claims Made Vs Occurrence Based Liability Insurance Policy?  

The choice to choose a Claims Made Vs Occurrence Based Liability Policy can have an enormous impact on your business.  Making certain your business has the proper coverage can make an enormous impact to your bottom line, when a claim occurs.  Claims Made Vs Occurrence Policies are typically in relation to a general liability, professional liability, and employment practices liability insurance.  The types of businesses who are more likely to need this type of coverage include contractors, architects, engineers, attorneys and medical professionals.

Claims Made Vs Occurrence Based Insurance Policies

Claims Made

A Claims Made Insurance Policy covers claims filed during a given period of time. In most cases, a claim must be filed during the term of the claims-made policy in order for it to be covered by the insurance carrier. If the claim is filed two months after the policy has ended, the claim will not be covered.  The positive to this type of policy is price. Claims Made Policies are generally less expensive compared to Occurrence Based Policies.

Occurrence

An Occurrence Based Insurance Policy covers claims that arise from damage or injury that takes place during the policy period.  This is regardless of whether the claim was filed during the term or after.  A claim can be filed many years later and still be covered, as long as coverage was in place during the time of the occurrence.  This is important for professionals like architects who give professional advice and services to physical structures that may have a problem years down the road. If it is found the problem with the structure was the result of the engineers faulty work, the engineer can be liable for damages.  With an occurrence based policy in place this would be covered under most circumstances.

For most business owners, an occurrence policy is more appropriate and is commonly purchased.  Only using a claims based policy can be a bit of a gamble.  In most instances, the additional cost of an occurrence policy form is minimal compared to purchasing a claims made policy.

Why are both Claims Made Vs Occurrence Based Insurance Policies Offered.

Why are both Claims Made Vs Occurrence Based Insurance Policies offered?

The primary reason claims made coverage is still around is because there is a demand and because insurance companies may only be willing to write certain types of risk on a claims made basis.  This is because it is much easier for an insurance company to estimate price for insurance premium and measure their profitability with a claims made policy compared to an occurrence policy.  This is because there is a clear start and stop date to coverage. With occurrence coverage, it can take years or even decades for insurance companies to measure their profit and loss.  In the most simple terms, a business owner who purchases an occurrence policy for one year will always be insured for future claims while a claims made policy only covers the insured for that time period unless they purchase additional tail coverage.  If the business owner is willing to take the risk in exchange for a lower premium, claims made policies are still offered.

Disadvantages of Claims Made Vs. Occurrence

The disadvantage of a claims made policy is that it is more complex. A claims made policy requires a strong understanding of the policy language used in the insurance contract. Additionally, a claims made policy is triggered by the insured’s awareness of potential claims and notification of the claim to the insurance company. Failing to properly notify the insurance carrier could void the coverage. The main disadvantage to an occurrence policy is the cost. On average Occurrence policies cost 35 percent more then a claims made policy.

Benefits of Claims Made Vs. Occurrence

The main benefit of a claims-made insurance policy is that it offers flexibility. The coverage is portable. You can take the coverage from one insurance company to another if you decide to switch carriers form year to year.  The primary benefit of an occurrence policy is that it is permanent. The period of time your business is insured under an occurrence policy is protected forever by that particular policy. With an occurrence policy the business never needs to renew or buy a tail when you leave.

Painters

Painters or painting, staining and decorating contractors fill a great role within the construction industry. As the economy continues to recover the need for painters continues to grow. With the growth in this industry comes an increase in risk and a need for more insurance coverage. The risks in this industry are much different than if you run an auto repair shop or an HVAC company.

There are certain types of information you will need for a general liability and workers compensation quote. Here are 5 policies every painting contractor needs to secure in order to completely cover them and their employees.

Find the best info about insurance coverage for painters at My Insurance Question.

 

General Liability

General liability insurance is normally the first coverage any small business purchases. This is no different for a painting contractor. In most states this coverage is required by law to be in business. General Liability coverage will cover your liability to third parties for accidents that occur as a part of normal business operations. For painting contractors who work at remote locations, it is important to speak with your independent insurance agent about what exactly is and is not covered when you are operating on the premises of a third party. If you interact with a general contractor who has many contractors operating at one location it is important for you to make sure all of the other contractors have the proper insurance required for the work taking place.

Inland Marine Coverage

Inland marine coverage will cover any specialized equipment you or your employees use as part of your daily operations. This is an important coverage to secure, especially if you have expensive specialized equipment, because most basic policies will not cover this equipment when it is damaged. For instance if you have a van or a vehicle with a trailer carrying extra tools, when a wreck occurs your commercial insurance policy will cover your liability to the other person hurt in the accident and to fix your vehicle, but it will not pay to cover your specialized equipment. This is a coverage your agent can help you determine if you need it or not. Depending upon how much the equipment costs, you may be able to do without this coverage.

Commercial Property Insurance

Commercial property insurance is different from your personal home owners insurance policy. It is different primarily because it is sold one of two ways: Replacement cost or on an agreed upon value of the property. It may be tempting to go with an agreed upon value to save on premium, but this is almost always a mistake. This is because the agreed upon value is usually what the property is appraised at currently. This amount does not include the cost to tear down the dwelling and remove all the debris after a disaster occurs. This additional cost can be extensive.

Commercial Auto Insurance

Commercial auto insurance is also different from a personal auto policy. Commercial auto can be purchased for vehicles your business owns, but it can also be purchased for employees who drive their own vehicles or rented vehicles while on the job. This type of policy is called hired and non-owned auto coverage. Again, with this coverage it is important to take some additional time to speak with your agent about the daily operations of your business. If you are honest with them about what you do on a daily basis they can do their best to prevent occurrences from taking place where your business or your vehicles are not covered.

Workers’ Compensation

Workers compensation insurance is the second coverage a business purchases because like general liability insurance it is required by law in most states. Workers compensation is like general liability, but it applies only to your employees and not to third parties. If your employees are injured at work as a part of what would be deemed normal business operations, workers compensation coverage will pay them for some of their lost wages (typically 60%) and medical expenses. Depending upon the state in which you operate in and the accident occurs, there are time limits on how long the employee can collect workers compensation benefits. Having adequate safety programs and a strong return to work program will help your business from experiencing excessive damage to your experience modification rating.

 

Here at My Insurance Question you can find the best advice on the insurance policies all painters need.

Recommended Insurance Programs for Painters

Minimum recommended coverage:

•   General Liability

•   Inland Marine Coverage

•   Property Insurance

•   Commercial Auto Insurance

•   Workers’ Compensation

Other coverages to consider for Painters:
Business Personal Property, Employee Dishonesty, Contractors’ Equipment (Inland Marine), Umbrella Liability, Commercial Auto Liability, Goods in Transit, Environmental Impairment Liability, Stop Gap Liability and Employment Practices Liability Insurance (EPLI).

Rental Property Insurance

When you own rental property with it comes a certain amount of risk. There are ways to lessen the amount of risk your or your business faces by properly preparing your business and purchasing adequate insurance coverage.  Here are 3 types of insurance you or your business need to secure when you own rental property.

If you own Rental Property, you need to determine what kinds of insurance your business actually needs?

 

If you or your business own rental property, there are certain insurance coverages you need to secure. Find out the best info at My Insurance Question.com

Three Policies every rental property owner should have. 

General Liability Coverage

General Liability Insurance in most cases is the first type of insurance a business or investor purchases. General Liability and Workers’ Compensation Coverage are required by law in 48 out of 50 states. For this reason, most business owners start with these two coverages and later determine if they need additional insurance.  GL Insurance covers a property owner for any liability they might face to thirds parties.  Some liabilities you may face include when a tenant or visitor are injured due to the landlord’s negligence, when a property maintenance issue results in a tenants’ injury or personal property loss or when a tenant is injured as a result of the landlord’s failure to keep the premises safe and in good working order.  Now these are just a couple of the types of liability a property owner may face.  Other risks you or your business face include losses due to fire, storm, tenant or employee theft and even discrimination lawsuits filed by tenants or employees. A lawsuit does not have to be legitimate to cause you or your business to incur enormous legal costs. Having the proper insurance in place can limit the damages to you or your business if you do face a lawsuit.

Commercial Property Insurance

Commercial Property Insurance is frequently the second coverage a property owner will secure.  When looking to acquire a commercial insurance policy it is important to secure an accurate valuation of the property. A Commercial Property Insurance Policy are just a little bit different than a personal home owners policy in that they are sold on either a replacement cost or on an agreed upon value. For most businesses the replacement cost policy is almost always the best type of policy to secure. This type of policy will pay to not only rebuild the property but also to demolish and haul away any and all debris. This additional cost can be substantial.

Business Loss of Income

Business Loss of Income Coverage is the third and final type of insurance all rental property owners should purchase. A business loss of income insurance policy will cover you or your business for the income lost during the period when a rental property is uninhabitable.  For example, if your building is damaged by a hurricane; this coverage kicks in to cover missed rent payments you or your business would have collected while the property is being repaired. Frequently this coverage is paid based upon documented actual revenue, which is good for property owners because you have a lease stating how much revenue the property generates.  Depending upon the policy you can collect payments for lost rent for up to 12 months after a loss.

 

Restaurant Insurance

3 tips to find the best Restaurant Insurance. 

How much insurance do I really need? What are the correct types of insurance for my restaurant? What types of restaurant insurance can I do without? What is the bare minimum I can get away with for restaurant insurance? These are all very common question that insurance agents get asked when a restaurant owner is looking to protect their business for the first time or a seasoned business owner is looking to renew their coverage. The answer to this question is like many things; ‘It depends’. There are many variables that go in to owning and operating a restaurant and those variables bring on many risks. Not every business owner is comfortable with the same amount of risk.  Depending upon how much risk you are willing to take, here are 3 tips to help you make sure you are purchasing the amount restaurant insurance.

Are you classified correctly?

First off, the small business owner needs to make sure their business is classified properly. This applies for both workers compensation and general liability insurance. Each state has their own governing body for these coverages.  The best way to determine if you are properly classified is to ask for help from an experienced independent insurance agent. When talking with your agent, it is crucially important to be honest with them.  This is important for the time you are open, how much and what types of alcohol you serve and what exactly your employees do.  Restaurants are classified different based upon the risks they face. Being properly classified can save your business immensely.

Pay as you go option

Workers comp coverage is required by state law in 48 out of 50 states. getting this coverage in place is an enormous cost.  Pay as you go workers’ compensation is s a great option for seasonal or cash strapped businesses. Pay as you go workers’ compensation allows a business to pay premium based upon the amount of payroll as opposed to an estimate of the monthly payroll. For many businesses they can get coverage in place for as little as a few hundred dollars.

Determine the proper type of Commercial Auto Insurance

Many business owners do not think they need any type of commercial auto insurance. Just because your business does not own vehicles, doe snot mean you do not need to secure some form of commercial auto insurance. If you do own vehicles that are going to be used for business purposes you most definitely need commercial auto insurance coverage. Also, if you have employees who use their own vehicles for business purposes than the business is liable for all accidents. Hired and Non-Owned Auto Coverage is a policy that kicks in when your employees use their own vehicle or a rented vehicle not owned by the company. Regardless of how small the activity may seem, when the employee is using any vehicle to do business activity you are liable.

 

 

3 Benefits of a Business Owner’s Policy.

What is a BOP?  If you work in insurance long enough, this becomes a question you receive quite frequently.  Many small businesses shop their policy around themselves to many different insurance companies. This can save those businesses some money, but it does come at the expense of the business owner’s precious time. Most insurance companies attempt to remedy this problem by offering a Business Owner’s Policy (BOP).

Find the answers to your questions about a Business Owner's Policy at My Insurance Question.com

A Business Owner’s Policy is an insurance package designed for businesses in a particular industry. These packages can be adjusted to fit the needs of each individual business, but they most commonly come in packages specific to each industry.  Over time, insurance companies have found certain coverages are needed by all businesses in a particular industry.  Because they have a unique insight in to the loss history of many businesses in that particular industry they tend to recommend a certain package of policies for that industry.  By offering a business owner’s policy, insurance companies can make sure there are no gaps in coverage.  At the same time they can make sure the business is not carrying too much or unnecessary coverage. Carrying a BOP benefits a business owner in three main ways.

Pricing

Pricing is one of the first aspects that attract business owner’s to choosing a BOP.  Insurance carriers are more likely to give businesses a discount if they know they are going to sell a business multiple policies. Business Owners can do the shopping for themselves, but they have to spend time searching for better coverage and price instead of working on their business. With the help of a good independent insurance agent, a business owner can allow the agent to shop the policy around to many insurance carriers. This allows the agent to negotiate the best price and the most complete coverage. For this reason, it is important to choose an insurance agent who has relationships with many insurance providers, not just a select few. Many agencies work exclusively with just a few carriers and this does not allow the agent to shop around your policy if you are in a tough classification code or have a negative claims history.

No gaps in coverage

Another great reason to consider a BOP is to ensure there are no gaps in coverage. Shopping for your policies individually might save a business a few bucks on the front end, but it be very detrimental to your business when a claim occurs.  This is a portion of the insurance industry where a few grey areas occur. When an incident occurs and a business has policy from many different carriers, at best they business will have to wait additional time while the carriers determine who is liable for the claim.  At worst, having several different carriers can cause the claim to not be covered at all.  On the contrary, if the policies are all with one carrier, the underwriter will just determine which policy needs to kick in and then processes the claim.  This is because, if you have a BOP with just one carrier typically there is General Liability, Professional Liability and an Umbrella policy. In this case the insurance company just determines which policy is in effect and processes your claim. When every policy is carried with one insurance carrier, that carrier can ensure there are no gaps in your policy.

Certificates

The final way businesses benefit from carrying a Business Owner’s Policy is when there is a need for a certificate. This occurs when businesses are involved in projects they are contracted on. Many artisan contractors do work for several general contractors. Take an electrician as an example. For each general contractor an electrician does a project for they need a certificate proving insurance coverage. If each coverage is with a different carrier that is an additional call the electrician has to make. If that electrician has a BOP they call one agent and can get a certificate for all of their policies.

These are three of the many benefits business owners get when they go with a Business Owner’s Policy. BOP’s are a win-win situation because the insurance company benefits from more business while the business owner benefits from having better service, more complete coverage and usually a better price. When in need of a business insurance quote it is also important to consult with an insurance agency who partners with many carriers. This will allow their agents to shop the policy to more carriers and ensure your business is getting the best coverage at the absolute lowest rates in the industry.

Business Interruption Insurance

Business Interruption Insurance is the key when disaster strikes your business.

Business Interruption Insurance is the key to protect your business when disaster strikes.

Having good commercial insurance is essential to the long term stability of your business.  It is a product that is necessary for you business, but a product you hope you never have to use. When there is a disaster that strikes your business, the quality of your coverage can mean the difference between a bump in the road and the end of your business.  One key policy to help your business whether the storm when a disaster strikes is business interruption insurance.

According to the Insurance Information Institute, “Business interruption insurance compensates you for lost income if your company has to vacate the premises due to disaster-related damage that is covered under your property insurance policy, such as a fire. Business interruption insurance covers the revenue you would have earned, based on your financial records, had the disaster not occurred. The policy also covers operating expenses, like electricity, that continue even though business activities have come to a temporary halt”.

This policy is normally offered as part of a Business Owners’ Package, but not always.  It is important to confirm with your agent if this is included in your package.  If it is not they will more than likely bring it to your attention as an add-on.  It is a policy to strongly consider for your business.  This business can help you pay necessary bills, retain key employees and may just be the difference between success and failure when a claim occurs.

In most states general liability and workers compensation insurance is required by law, but those are the bare minimum coverages any business should secure. Most businesses need several additional coverages to properly protect the organization.  If you own property or vehicles their is a need for commercial property and auto coverage.  If you own specialized equipment there may be a need for inland marine coverage.  The one frequently forgotten coverage is business interruption coverage.  Many small business owners fail to anticipate how they will pay their bills in the event a claim causes their business to be closed for a period of time.  When this occurs the bills keep coming and payroll has to be met.  If you are a cash strapped company, failing to secure this coverage may cause the ultimate failure of your business.