If you’re starting a business, you probably have a plan and a to-do list. One thing that needs to be on it is small business insurance. While all business owners know they need protection, the potential time and money drain can be offputting. Next Insurance surveyed 30,000 small business owners and found that 44% did not have insurance. Yet, having small business insurance, along with the right tools to start your business, will save you both time and money.
What are the most important types of insurance for a small business?
Depending on the industry, a business may need a combination of one or more of the following types of insurance.
- General Liability Insurance: protects a business from the financial costs of property damage or bodily injury, for example, if somebody hurts themselves on your property.
- Professional Liability Insurance: protects the work a business does and any mistakes that might occur.
- Business Property Insurance: Protects the physical location that your business owns or leases, as well as properties, tools, and inventory.
- Business Income Insurance replaces lost income when you are unable to conduct business due to a covered loss like theft or a fire.
Cyber Liability or Data Breach Insurance is critical to consider in this digital age. With it, your business would be covered in the event of a data breach or loss of digital property.
Insurance providers such as The Hartford and Hiscox have policies customized to small businesses needs and can expand as your business grows. Hiscox, for example, has insurance plans for 50+ types of small businesses. See if your industry is on their list.
It is usually worth getting a higher deductible, to make your premium less expensive, and taking on more risk yourself, but pay less every year.
What do I need to prepare before purchasing an insurance policy?
CUEMarketplace spoke with Gwen Jaques, an Insurance Agent with 22 years of experience. She says insurance has always been complicated and business owners need to be prudent to ensure they are getting the right type of coverage. Jaques recommends gathering together all business documents as you prepare for the conversation with an agent or broker. Essential documents include:
- Business Tax ID Number and Entity Set up
- Gross Receipts
- Number of employees or subcontractors
- A list of business assets such as equipment
Organize the important details of your business, and once you are ready with all this information, go online to find a broker that specializes in small business insurance, or contact insurance companies directly to discuss their small business policy.
What don’t businesses owners usually consider when setting up a business?
There are two things that businesses don’t usually consider when setting up a shop, and both of these concern the future success of the business.
The first is to consider insurance that will protect the future of the business. Jaques says that many business owners don’t see the need for something like a partnership agreement until the business hits a rough patch. “Say your partner dies unexpectedly, who is going to take over their share of the partnership?” Many insurance and online legal sites offer the necessary partnership agreements that mean the business keeps running smoothly if you’ve hit success and need such an agreement to prevent future problems.
Another resource business owners need to improve the future running of their business is the best business software. Like having insurance, the right software can save time and money in the future, and support the growth of your business. Products such as accounting, a website, a business email, and data security that are specifically designed for small businesses, keep everything running smoothly. CUE Marketplace is a one-stop-shop for a bundle of products that will help you start a business, plus many more products that will help you grow, and a management dashboard to keep it all organized.
For a limited time CUE is offering a free 30-day trial and a 20% lifetime discount on software to start your business.
All of the products in this blog can help small businesses achieve their goals. To find out more about starting a business, please visit the CUE Marketplace. CUE only recommends products we believe will add value to our readers. For some links in this post, CUE may receive an affiliate commission.