Key Elements of Insurance Coverage for Small Businesses

Small business owners have to contend with many different types of risk. A comprehensive plan to manage risk must include insurance policies that safeguard them against liability and loss.

General Liability

Getting a general liability policy equips businesses to manage common types of claims that an individual or a business entity could make against it. The coverage can pay for settling a claim or defending the business in court.  

Directors and Officers Insurance

A small business’ corporate officers could face personal liability when the business takes on financial liability. Also, their role in managing a company could expose them to claims. Including a directors and officers policy in a small business insurance package can protect the business’ leadership from financial liability for lawsuits.

Commercial Auto Protection

Any type of business that operates at more than one location may need to include a commercial auto policy in its insurance coverages. Personal auto policies often exclude coverage for accidents that occurred while someone is using a vehicle for commercial purposes. Also, a business may be a more appealing defendant than an individual in a lawsuit for a personal injury.

Small businesses have to manage their resources carefully. Insurance coverage must closely fit its needs and risk exposure without putting an excessive strain on its operating budget.