General liability is one of the most essential types of business insurance in Montana and often the first type of coverage purchased by small businesses.

This kind of insurance, also known as commercial liability insurance, can help companies pay for damages if someone other than an employee blames them for causing injury or damaging property. General liability coverage also can help pay legal fees if you’re sued over such claims.

For instance, a self-employed house painter in Billings accidentally spills paint on a sofa and carpet during a job. The painter’s general liability coverage could help cover the costs of replacing the damaged items.

Tools and equipment insurance is a general liability add-on that owners of construction and cleaning companies might need. If business gear is damaged, lost or stolen, this type of coverage can help pay to repair or replace it.

Small businesses with employees in Montana almost always need to carry workers’ compensation coverage. When employees are injured on the job, this type of insurance can help pay for medical bills and lost wages as the employee recovers.

Workers’ comp insurance would apply in a scenario like this:

An employee at a fine dining restaurant in Great Falls gets a serious cut prepping ingredients and needs stitches and a few weeks off to recover. Workers’ comp can help the injured employee cover their medical expenses and provide lost wages until they are well enough to return to work.

Because personal auto insurance doesn’t cover accident damages that happen when driving for business reasons, Montana businesses that own vehicles will want to purchase commercial auto insurance.

Commercial auto coverage can help pay for damages if a person at your company injures someone or destroys property in a business-related accident.

For instance, an employee of a Bozeman-based construction company totals the work van in a collision, sending another driver and passenger to the hospital. Commercial auto coverage can help cover the injured parties’ medical expenses and help pay for damages to vehicles and other property.

Montana commercial property coverage can help protect the essential things you need to run your business. It can help cover the cost to repair or replace your business property, equipment and physical premises, in the case of covered events like fire, water or wind damage.

Here’s an example of when commercial property coverage would come in handy:

A clothing store in Helena experiences an electrical fire that causes smoke and heat damage, ruining fixtures and its inventory. Commercial property insurance could help pay to clean up the damage and cover replacing damaged items.

Keep in mind that commercial property insurance can have exclusions, such as for flooding or hurricane damage. Be sure to read your policy documents carefully so you know exactly what your coverage includes.

If someone accuses your business of making a work mistake that causes them financial losses, you could be held responsible for paying damages. They could also sue your company for negligence.

For these reasons, business insurance packages in Montana might include professional liability insurance. Also known as E&O or errors and omissions insurance, this type of coverage can help pay for damages associated with work mistakes, missed deadlines and incomplete projects.

Here’s an example of when professional liability insurance would come in handy:

An employee of a Missoula-based architecture firm misses a deadline for submitting building plans, which causes a delay in the project. The client says that the oversight caused a substantial financial loss.

The architecture company’s professional liability insurance could help reimburse the client for the losses. If the client filed a lawsuit for additional damages, E&O insurance could help pay the firm’s attorney fees, court costs and any additional damages for which the business is found liable.