5 Other Forms of Small Business Insurance Coverage

Do you own a small business and need small business insurance coverage? Are you thinking of starting a business but want to learn more about small business insurance coverage? No matter where you are in your business plan, small business insurance is crucial. Aside from basic business insurance options, here are some non-traditional forms of small business insurance coverage you should consider.

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1. Errors and Omissions Insurance/Professional Liability

One little-known form of small business insurance coverage is Errors and Omissions Insurance/Professional Liability. Some businesses involve services such as giving advice, making recommendations, designing things, providing physical care or representing the needs of others. These types of businesses are sometimes sued by customers, clients or patients claiming that the business’s failure to perform a job properly has injured them. Errors and Omissions or Professional Liability insurance covers these situations.

This coverage will pay any judgment for which the insured is legally liable, up to the policy limit. It also provides legal defense costs, even when there has been no wrongdoing.

2. Employment Practices Liability Insurance

Employment Practices Liability insurance covers (up to the policy limits) damages for which an employer is legally liable such as violating an employee’s civil or other legal rights. This small business insurance coverage also provides for legal defense costs, which can be substantial even when the business has exercised sound judgment.

3. Directors and Officers Liability Insurance

Directors and Officers Liability insurance protects directors and officers of corporations or not-for-profit organizations if there is a lawsuit claiming they managed the business or organization without proper regard for the rights of others.

This form of small business insurance coverage will pay any judgment for which the insured is legally liable, up to the policy limit. It also provides for legal defense costs, even where there has been no wrongdoing.

4. Key Employee Insurance

Life or disability income insurance can compensate a business when certain key employees die or become disabled. These forms of small business insurance coverage cushion some of the adverse financial impact that results from losing a key employee’s participation.

5. Umbrella Policies

As the name implies, an umbrella liability policy provides coverage over and above a business’s other forms of liability small business insurance coverage. It is designed to protect against unusually high losses. It provides small business insurance coverage protection when the policy limits of one of the underlying policies have been used up.

For a typical business, the umbrella policy would provide protection beyond the general liability and auto liability policies. If a company has employment practices liability insurance, directors and officers liability, or other types of liability insurance, the umbrella could provide protection beyond those policy limits as well.

Do you need small business insurance coverage? Compare small business insurance quotes today with InsWeb and make sure you are getting the right policy for a great price.