Business insurance requirements vary across states, and the names of individual coverages may not always be consistent among insurance companies. For example, The term “boiler and machinery insurance” describes insurance against unplanned boiler, machinery, and equipment breakdowns.
To further complicate matters, terms like “boiler and machinery insurance” often cover items other than what their names imply, such as computers and office supplies.
Scroll down to learn about business insurance types in detail.
General liability insurance
General liability insurance is one of the most crucial coverages due to the type of protection it provides, even if it is not legally required. It offers financial security for your company against claims of property damage and bodily injury from your daily operations. It is also known as business liability or public liability insurance.
Most policies provide product liability coverage, protecting businesses from lawsuits arising from injuries or losses resulting from the sale or production of a product.
Commercial property insurance
When natural or man-made calamities destroy your company’s physical assets on-site, commercial insurance for property helps lessen the financial effect. These consist of:
- Operates in property or building.
- Uses equipment and technology.
- Stores and sells product and material inventory.
Commercial property insurance helps minimize the impact of unexpected events on your day-to-day operations by covering losses and damages. If the damage prevents your company from performing regular activities, some policies also pay out a portion of lost revenue. This type of business insurance is often required in commercial leasing agreements; however, it is not required.
Workers’ compensation insurance
Workers’ compensation insurance protects your business from the financial liability of paying for costs resulting from job-related injuries and illnesses. Almost every state in the US mandates that companies with a specific number of workers have this type of insurance.
As a business owner, you are responsible for the full cost of coverage. Employee contributions to the premiums cannot be mandated.
Additionally, workers’ compensation insurance operates on a no-fault basis. Although there are several circumstances that may result in workers’ compensation claims being rejected, this shows that an employee’s benefit is unaffected by their or your company’s fault.
Commercial vehicle insurance
Commercial vehicle insurance is a legally required business insurance policy type. With one significant exception—it mostly covers business vehicles, including trucks and vans—this type of coverage works similarly to private auto insurance.
Businesses can get UM and UIM coverage individually in several states. Additionally, coverages are tailored to a company, such as those for lost business income.
Health insurance
Under the Affordable Care Act (ACA), businesses with more than 50 full-time employees are required to purchase health insurance for their employees. If you employ fewer than fifty people, you can use the Small Business Health Options Program (SHOP).
A percentage of the professional and hospital fees are covered by health insurance, which helps defray the costs of medical care. US companies pay over 83% of their employees’ total health insurance costs for single coverage and 72% for family coverage. According to estimates, these are $7,911 and $22,463 annually, respectively.