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General Liability Insurance for Small Business many small business owners probably ask themselves the question, “why should I have general liability insurance for small business in place versus just going bare?” Normally the answer that question is answered on your behalf by your vendors and or clients. What we mean by this is that normally your clients and your vendors will require you to have liability insurance for business in place in order to do business with them. Usually the larger your client and/or vendor is the higher the coverages and limits that can be required of you.

Business general liability insurance therefore can be used as a protection tool for all of your assets as well as a tool for entering the bidding process in gaining much larger clients and/or vendors for you. It is very common when dealing with Fortune 1000 companies that you will be required to have very broad coverages and very high limits of liability. Crafting your small business liability insurance to address all of these concerns and/or requirements up front can save you money in the long run as well is make you money in the long run by being able to land deals with larger companies.

It would be prudent in the process of the obtaining your personalized general liability insurance quote that you ask for coverages and limits of varying amounts. That way as contracts and request for proposals come your way throughout the business year you will know in advance how to price your products and services based on having multiple options of small business liability insurance quotes at hand. This should help you in the negotiation process with your clients and/or vendors to have the pricing of premiums for the various coverages and limits so that you do not contractually agree to something that you possibly cannot afford.

Your business liability insurance quotes should include limits of $300,000, $500,000, and $1 million. You should also obtain umbrella quotes for $1 million, $2 million, and $5 million. The business liability insurance may or may not have professional liability insurance unless it is desired and/or acquired by your vendors. If you have a professional liability exposure it would be wise to get the pricing for various limits up front as normally time is of the essence when you are bidding for jobs. When you get your general liability insurance quotes it is usually very difficult to obtain apples for apples proposal from various brokers. It is in your best interest to dictate the proposal format to the brokers versus allowing them to serve up their preferred format to you.

General Liability Insurance for Small Businesss can be a pain and can be pricey, but if you view it as an opportunity to protect your assets as well as to provide an open door into much larger accounts for you because you already have the insurance in place it should pay greater dividends for you in the long run.

Property Insurance can be written as a standalone policy or can be written as coverage within a package policy. The first step in obtaining property insurance is to make sure you have identified all of your property that is at risk and then decided which of those properties to provide insurance on.

There are several broad categories of property that you should consider in your asset protection analysis and your resulting choice of business property insurance. We will look briefly at those categories below.

  • Real property. This typically includes your buildings, land, and improvements and betterments. Once you have determined what real property you want insurance for as well as the limits that you desire, you would need to determine what kind of perils specifically you want to insure for. Some of the most common types of perils with regards to real property could be losses from fire, wind, hail, riots, vehicle damage, explosion, smoke, vandalism and malicious mischief,, weight of snow or sleet, water damage, backing up of sewers, landslides, earth movement, volcanic eruption, and difference in conditions.
  • Personal property. This property is more mobile in its nature. This would be your personal contents, personal property, your personal effects, your business inventory, raw materials, work in progress, finished products, mobile equipment, contractor’s tools and equipment, and property of others. This category of property also is subject to the same kind of common perils that were listed above under real property, such as fire theft and vandalism and the like.
  • Intangible property. Many small business owners tend to forget their intangible property which can and normally does have substantial value. A financial loss of intangible assets can create financial hardships on a small business owner. Accounts Receivable is one of these types of intangible properties that you could suffer financial loss. If you cannot reconstruct your Accounts Receivable after a fire loss, chances are that many of your Accounts Receivable clients will not automatically be sending in their payments without first receiving an invoice and/or statement from you. Not having the names and addresses of your Accounts Receivable clients and/or the amounts due and balances owed can have a severe financial impact on your bottom line. Once again many of the same perils that have been listed above are also the same perils that can cause claims and losses to your intangible property. The flipside of Accounts Receivable is that of Accounts Payable. If you do not have the names and addresses of your accounts payable and amounts due and amounts owed you may not be aware of your financial condition in the midst of the loss that you have just suffered via a fire, theft, or embezzlement for an example.

Property Insurance is the type of insurance that specifically covers your tangible and intangible assets from direct losses. The steps of identifying which broad category that your property is exposed as well as what perils you are at risk of suffering a loss will then lead to you designing the proper property insurance portfolio for your small business insurance program.

Hopefully this brief summary of property insurance will help you as a small business owner to ascertain whether you have addressed all of your property assets in the coverage that is needed to protect the financial health of your small business.

Professional Liability Insurance which is also known as errors and omissions insurance, E. & O and malpractice insurance , are all common terms used to describe professional liability insurance.

Some of the common areas way or this specific coverage is needed are found in the following industries. Architects and engineers typically need this type of insurance. The drafting, designing, and building projects according to specifications that the architect and engineer creates, typically have innate professional liability insurance exposures.

Lawyers and attorneys professional liability is another unique specialty niche for professional liability insurance. Whether it be civil law, constitutional law, or criminal law almost all of the work and services that are produced by an attorney or of an in tangible nature and professional.

Doctors, dentists, chiropractors, and almost every aspect of professional healthcare require malpractice insurance which is a form of professional liability insurance. While all of these healthcare professionals typically give counseling and professional advice, they also are normally also administering hands-on physical contact with people in general.

The next category is that of agents. Some of the more common types of agents would be real estate agents, insurance agents, mortgage broker agents, and travel agents. All of these types of professionals have a professional liability exposure in the professional services that they are providing.

There are also some specialty niches that require professional liability insurance as well. Some of these industries might include technology consultants, business management consultants, media consultants, human resources consultants, and financial advisors.

Many small business owners wrongly assume that there general liability insurance policy will also expand to cover their professional liability exposures. Whether or not the professional liability claim has merit, having a professional liability policy in place will provide you with the legal defense that is necessary to defend you against any and all claims. While 95% of all claims never go to court, it is the defense of the claim that can cause severe financial harm even though you are not at fault. Businesses that have professional liability exposures tend to have much greater exposure to large claims that are professional in nature versus a large claim on their underlying general liability insurance.

Because the common law legal system is an ever changing system in a state of flux the requirements that are required in all professions tend to be very fluid versus static. Thus, having a professional liability insurance policy in place will go a long ways in providing the ever-changing protection that you will need in the future. Making sure that your policy has worldwide coverage is something that you need to consider especially as professionals do business in the global economy.

Professional Liability Insurance normally does not cover the same types of claims and losses as a general liability policy does. Nor does the general liability policy cover the same types of claims and losses that professional liability policy does.

Hopefully this brief summary of the professional liability insurance will help you as a small business owner to ascertain whether you have a professional liability exposure that requires professional liability as part of a small business insurance package.

General Liability Insurance is the foundational building block for almost all small business insurance programs. Understanding some of the key components that go into these general liability insurance policies can help a small business owner in obtaining liability insurance quotes and in the actual purchase of their commercial insurance policies. Below we are going to take a look at the standard commercial general liability for small business policy that is used in almost all of the 50 states.

  • Business liability each occurrence: This policy is typically written with a business liability each occurrence limit. The business liability occurrence limit can start out as low as $100,000 and go up to as high as $2 million. The typical business liability each occurrence limit is normally $1 million. This coverage specifically provides protection for bodily injury and property damage claims that you become liable for.
  • Business liability general aggregate: Typically the business liability general aggregate is twice the limits of the business liability each occurrence limit. Thus, if the business liability each occurrence limit is $1 million then the business liability general aggregate would be $2 million. Although, the business liability general aggregate can also be written for the exact same amount as the business liability each occurrence limit. An easy way to remember what general aggregate really means in layman’s terms is that this is the maximum amount that it insurance company will pay in anyone policy year. This prevents the stacking of limits. This also prevents attorneys from saying that the claim occurred 30 times during the policy year and thus the potential for the insurance company to have to pay $1 million times 30 times in one policy year.
  • Products/completed operations aggregate: This aggregate limit is also normally twice the limits of the business liability each occurrence limit. So, if the business liability each occurrence limit is $1 million then up products/completed operations aggregate would be $2 million.
  • Personal and advertising injury: This limit is normally the same limits as the business liability each occurrence limit. If the business liability each occurrence limit is $1 million in the personal and advertising injury limits would be $1 million. This coverage provides protection for the personal injury of a person that is not bodily injury or property damage. It also provides protection for unintentional liable and slander claims.
  • Damage to premises rented to you: This limit varies by insurance company but is normally $300,000. This coverage provides protection to pay for damages that you cause to the premises in your care custody and control. This coverage is not applicable if your own property.
  • Medical payments: This is a Good Samaritan type of coverage in that it pays medical bills to third parties who become injured on your premises even though you are not legally liable. The limits for this coverage do vary by carrier but is normally $10,000. This protection is not available for you and/or your employees. This is for your clients and/or other third parties that come on to your premises. You normally have up to one year to ask for this coverage to pay for claims that it happened on your premises.

General Liability Insurance normally provides much broader coverage and protection than the average person perceives. Hopefully, this quick summary of the coverages will help you as the consumer to be more comfortable in obtaining small business insurance quotes.

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