Small Business Health Insurance Policies

by Gaurav Bhola, MSM, Managing Editor
Wednesday, August 08, 2007

Many businesses that are starting out have to conserve their cash flow. The last thing on their mind is insurance, more specifically business insurance. But one has to remember insurance serves as an "in case" policy, to protect you and your business "in case" something happens.

If something does occur, damage to your property, theft, disability or some other unforeseen circumstance; at least you will have peace of mind that you are taken care of. The premium you pay now to protect yourself will end up costing you a lot less financially than paying substantially more out-of-pocket.

Does it really pay to be a penny wise and a pound foolish? Don’t trip over dollars to pick up pennies. Here is a list of business insurance policies that most businesses need:

  • General liability Insurance
  • Property Insurance
  • Disability Insurance
  • Business Auto Insurance
  • Workers Compensation Insurance

General Liability Insurance – Nothing can stop someone from suing you. For example, a third party can file suit for defective products, error in service, accidental damage to their property, and much more. Liability insurance is important if you believe your business can be at risk of lawsuit by others for negligence. If you provide professional services, sell manufactured products which may be harmful, and offer employment; liability insurance is good to have. Critically, liability insurance protects you by paying any damages up to the limit as well as any legal defense expenses. Also, it pays for any medical expenses of the injured third party.

Property Insurance – Property insurance protects your business property from certain risks. Your business assets such as the building and equipment are covered in the occurrence of theft or damage caused by explosions, accidents, fire or acts of nature. The insurance company compensates you in case of loss to such common perils. The insurance compensation can come in handy during the transition period of rebuilding your business to get it back on track. Exhaustive and detailed coverage can also compensate you for water damage, equipment malfunction, debris cleanup and removal after a fire, and other losses.

Disability Insurance – Have you ever considered what happens if you become disabled? How will you maintain your standard of living without income coming in on a regular basis? Well, that is where disability insurance can help. In case a disability occurs, the insurance company pays a monthly benefit to replace lost income due to an accident or illness.

Business Auto Insurance – It may be a good idea to get your automobile insured if it is used for business. In most instances private or personal car insurance policies do not cover damages in case your business auto is involved in an accident. Herein, a separate business auto policy that covers your business automobiles will protect you against liability claims and pay for damages. So, the insurance coverage provides up to the policy limits for any bodily injury and property damage to third parties arising out of the accident. Also, in-depth coverage will pay for the damage to your auto or completely replace it if needed.

Workers Compensation Insurance – After your business has a certain number of employees, you must have workers compensation insurance, except In Texas. Workman’s or workers comp insurance provides for medical care and pays some lost wages to employees due to injury on the job. If an employee dies as a direct result of injuries obtained during work, the insurance company compensates the employee’s family.

The above are but a few of the many types of insurance available to businesses. Before you disregard certain types of insurance coverage due to the cost of the premium, take a moment to calculate the tangible and intangible costs of not having it if something were to happen.

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