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What is business owner’s insurance?

  • Business Insurance Basics

A business owner’s policy is a handy insurance product that’s designed to protect your small or medium business from many different kinds of property damage and liability. The main thing to know about business owner’s insurance is that, although it sounds like one coverage, it’s actually a bundle of important coverages that are sold together. Basically, it’s a convenient package deal.

TL;DR? If you buy business owner’s insurance and workers’ comp, chances are you’ll have the insurance you need to run your business without fear of the unexpected.

What coverages are included in business owner’s insurance?

Business owner’s insurance provides some pretty vital coverages—some of which could save your business in the event of a disaster. Here are the major elements:

1. General liability insurance

This covers your company’s legal responsibility for any harm it may cause to other people or to their property. If you or your employees do something (or fail to do something) that results in bodily injury or property damage, this coverage kicks in.

2. Property insurance for your building

This insurance covers any buildings your business owns. In the event of damage, property insurance will pay out for the cost of repairs or rebuilding. (If you rent your building, no worries: you can opt out of this coverage.)

3. Business personal property insurance

This coverage insures your company’s property (think furniture, equipment, and technology) against theft or damage.

4. Business interruption insurance

This coverage provides a financial benefit in case your business is ever forced to suspend operations. It will pay for expenses such as rent or payroll while you work to get your business back up on its feet.

What coverages aren’t included in business owner’s?

As handy as a business owner’s policy is, it doesn’t cover everything. Here’s what’s not included:

1. Workers' comp

If you have at least one employee, you likely need this coverage. But you’ll have to purchase it separately. It’s not included with your business owner’s policy. (Luckily, with Huckleberry, it should only take about 5 minutes to get a quote for both coverages.)

2. Auto insurance

You’ll need to insure your company’s dedicated vehicles separately (be sure to get commercial auto insurance).

3. Health and disability insurance

Business owner’s insurance won’t cover you or your employees if they get sick. Make sure to shop for this one separately if it’s a benefit your company offers.

What coverages should you add to your business owner’s insurance policy?

Depending on which insurer you choose, you’ll likely be presented with options for add-on coverages. Which should you choose? Well, that depends on your industry and the kinds of risk you’re willing to accept.

Let’s look at a few common insurance add-ons and discuss who might be most likely to benefit from each one. (Keep in mind: if you get a quote from Huckleberry, we’ll walk you through each decision. And we won’t offer you any insurance that isn’t appropriate for your business.)

1. Hired and non-owned auto insurance

Straight out: if all the vehicles your company uses are owned by the business, you probably don’t need this coverage. That’s what a commercial auto policy is for. But if your business ever rents vehicles (or if your employees ever use personal vehicles for work errands), you might want to think about adding this coverage. It’ll protect your business from liability in case of an incident involving a vehicle you don’t own.

This is a popular add-on. About half of all businesses elect this coverage.

2. Employment practices liability insurance

If one of your employees ever sues your company for an illegal employment practice (think discrimination, wrongful termination, harassment, or failure to promote), this coverage will step in to cover any financial damages.

3. Employee dishonesty coverage

This coverage will repay losses if an employee steals money or property from the business. It’s normally purchased by restaurants and retail stores.

4. Liquor liability coverage

This insurance covers losses that result from accidents related to serving beer, wine, or spirits. (Yes, it’s for restaurants and bars.)

5. Professional liability insurance

This coverage protects your business in case a client suffers damages as a result of your professional advice and services. It’s often purchased by beauty salons and barber shops, where a bad suggestion or a slip of the scissors can result in a very unhappy customer (and, unfortunately, a lawsuit).

That’s the rundown on business owner’s insurance. If you’re ready for a quote, we can get you one in less time than it takes to make a coffee run. Everything’s online and everything’s easy.


All content on this page is for general informational purposes only and does not apply to any specific case, is not legal, tax or insurance advice and should not be relied upon. If you have any questions about the situation for your small business or the latest information in your state, you should contact an attorney for legal advice, an insurance agent or broker, and/or your state's labor or industry agency, board, commission or department. Please note that the information provided on this page may change at any time as a result of legislative action, court decisions or rules adopted or amended by any state or the federal government.

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