5 Other Forms of Business Insurance

Do you own a small business but need business insurance coverage? Are you thinking of starting up a business but want to learn more about business insurance coverage? No matter where you are in your business plan, you need to make sure that you have an adequate amount of business insurance coverage. Aside from the basic business insurance coverage options, here are some additional forms of business insurance coverage the Insurance Information Institute recommends you consider.

1. Errors and Omissions Insurance/Professional Liability

One little-known form of 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, which can lead to being 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. The policy 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. In addition to paying a judgment for which the insured is liable, it also provides legal defense costs, which can be substantial even when there has been no wrongdoing.

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. The policy 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 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 business insurance coverage. It is designed to protect against unusually high losses. It provides 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.

If you are looking to insure your business, compare business insurance coverage with free quotes at InsWeb.com to make sure you are getting the right policy for a great price.