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How to get business insurance

How to get business insurance

Starting a business typically isn’t cheap. Business owners are often required to make personal and financial investments to get their idea up and running.

One study found that small business owners spent an average of $40,000 in their first year.1

That’s why insuring a business is an important step to make sure that the time and money you invest is protected.

The right small business insurance can provide essential coverage that keeps you financially stable when the unexpected happens.

Even if you’ve been in business for years, you may need to reevaluate your coverage to make sure you have the protection you need.

If you’re wondering how to get business insurance, you’re not alone.

Common concerns for business owners include questions like:

  • How do I get insurance for my business?
  • What do I need to get business insurance?
  • How long does it take to get business insurance?
  • And how do I get cheap business insurance that’s also reliable?

Fortunately, insuring a business doesn’t have to be complicated.

Use this step-by-step guide to figure out which policies you need and how to find the right insurer:

1. Evaluate your business risks

Different businesses face different types of risks.

For example, a general contractor might have much more exposure to accidents and injuries than a financial advisor who works behind a desk all day.

However, accidents can still happen in an office environment, and there are other risks to consider besides bodily injury or property damage.

For example, a financial advisor could make an investment mistake that causes their client to lose thousands of dollars.

Consider the following possible risks when determining what type of business insurance coverage you need:

Potential lawsuits

Certain types of business insurance can help protect you from financial losses if someone sues you after an injury, property damage or a financial loss. Think about which risks are most likely to happen at your business.

Your business operations

If there’s a higher level of risk in your industry, you may need more coverage to protect your business. Businesses with multiple locations, work vehicles and/or many employees may also need more coverage.

The types of work your employees do

Your insurance coverage needs to be tailored to the risk involved in your employees’ work — especially if there’s a greater chance of physical injury — and the number of employees at your business.

2. Shop around

Once you’ve assessed the risks your business might be exposed to, it’s time to shop around.

One of the best ways to do this is to get business insurance quotes online from different insurers. It helps to have a general idea of what you would pay for business insurance depending on insurance compnay choose.

You can also look for special offers that may make your insurance costs (also known as premiums in the industry) more manageable. For example, you may be able to get a discount if you bundle multiple policies in one insurance package.

Keep in mind that cost isn’t the only factor to consider when deciding where to get business insurance. Comparing rates is a good starting point, but you should also look at the policy limits and coverage details to make sure you’re getting the protection you need.

3. Choose a reputable insurance provider

Another key tip for how to shop for business insurance is to make sure the provider you choose is legitimate and trustworthy.

If you have to file a claim, you want to feel confident that your insurer will help you quickly resolve it.

When figuring out how to choose business insurance from a number of potential providers, consider these key questions:

  • What’s their specialty? Work with an insurer that specializes in small businesses so they can recommend the right policies for your needs.
  • What do the reviews say? Research the company to evaluate its reputation, and look up reviews to see what its customers are saying.
  • What is the customer experience like? The process for how to apply for business insurance should be easy and intuitive with options for customer support if you have questions.
  • Is it easy to get a certificate of insurance? Clients and licensing boards may request a certificate of insurance (COI) as proof of coverage. Find out whether it’s easy to obtain COIs on demand and whether you’ll be charged for each one.

4. Reevaluate your coverage needs every year

It’s important to set a reminder to reevaluate your coverage needs about once per year.

Your insurance needs could change if you:

  • Add new products or services
  • Change your operations significantly
  • Hire an employee
  • Open or move to a new location
  • Significantly increase/decrease revenue

Your business won’t remain stagnant, and your insurance policies shouldn’t either. You need to make sure you have sufficient coverage as things change over time.

Types of business insurance

You might be wondering, what types of coverage do I need to insure my business? The answer varies depending on how your company operates, but the following insurance policies are often recommended for many small businesses.

General Liability insurance

General liability insurance can cover a wide range of common risks that most businesses face.

It helps pay for costs related to certain types of accidents involving a third party, such as damage to someone else’s property or an injury to someone other than an employee.

Depending on your industry, clients may request proof of liability coverage before they agree to work with you.

Professional Liability insurance

Professional liability insurance (also known as errors and omissions insurance) helps protect your business if a client accuses you of being negligent or making a professional mistake that causes them to lose money. Whether their claim is true or not, this insurance can help pay for legal defense costs and legal judgments.

Many businesses in the professional services industry include this in their business insurance packages.

Workers’ Compensation insurance

Workers’ compensation insurance can provide important protections for your business if a workplace injury occurs.

It can help pay for medical expenses, lost wages and other benefits if an employee gets hurt on the job. Many states require employers to carry this type of insurance.

Commercial Property insurance

Commercial property insurance can help pay for costs related to damage or vandalism to business property, including the goods, gear, equipment and structures you need to do business. Your landlord may require you to carry this insurance if you rent commercial space.

Note: You can combine general liability coverage with commercial property insurance for a business owner’s policy (also known as BOP).

Commercial Auto insurance

Commercial auto insurance can help pay for medical expenses, property damage, towing, repairs and other related expenses if you or an employee are involved in an accident. It’s usually required by law for business-owned vehicles.

How NEXT helps protect small businesses

NEXT is a one-stop shop for small business insurance.

We offer a streamlined and simple way to find the business insurance you need online. It usually takes less than 10 minutes to get covered.

Our DIY system makes it easy for you to review your coverage, make changes to your existing policies and access your certificate of insurance with our mobile app or website.

Get a free instant quote today.

 

Sources

1 The Cost of Being the Boss: What Business Owners Spend in Their First Year

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Let’s find the coverage you need for your business

Business insurance is divided into different policies. We offer seven types so it's easy to design the coverage that fits your small business.

General Liability insurance
General Liability

Protect yourself from accidents that cause physical injury or damaged property.

Professional Liability or Error and Omissions Insurance
Professional Liability/E&O

Shield yourself from lawsuits that claim your work errors caused financial losses.

Workers' Compensation Insurance
Workers’ Compensation

Cover medical bills and lost wages if your employees have an accident at work.

Commercial Auto Insurance
Commercial Auto

Stay on the road with coverage for dents, tows and damage to someone else’s vehicle.

Tools & Equipment Insurance
Tools & Equipment

Upgrade your general liability coverage to protect any gear that’s stolen, damaged or lost.

Commercial Property Insurance
Commercial Property

Keep your building, inventory and equipment protected from fire or water damage.

Business Owner’s Policy Insurance
Business Owner’s Policy

Combine general liability and commercial property into one policy to protect your business.

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* To the extent permitted by law, applicants are individually underwritten, not all applicants may qualify. Individual rates and savings vary and are subject to change. Discounts and savings are available where state laws and regulations allow, and may vary by state. Certain discounts apply to specific coverages only.
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