Skip to content

What Does a Good Business Insurance Policy Contain?

One of the first steps in starting a new business is to insure it. With so many types of coverages available, choosing among them can be difficult. Here are two basic types of insurance that any good business insurance policy should contain.

Liability

Because lawsuits are so commonplace in American culture, businesses have no choice but to protect themselves with liability insurance. This type of policy pays for legal expenses associated with defending yourself in court and paying settlements. General liability is a necessity, but you can also add the following coverages:

  • Professional liability
  • Cyber liability
  • Employment practices liability
  • Pollution liability

Workers’ Compensation

The federal government requires that businesses with a certain number of employees carry insurance to protect them in case they sustain injuries on the job. Individual states regulate compliance with this mandate, but most allow companies to purchase workers’ compensation insurance through the providers of their choice. By working with an insurance agent, they can effectively manage their risks while keeping their premium costs low.

These two types of insurance are extremely important, but more policies exist to meet your unique needs. By diversifying your business insurance to cover all your potential risks, you can avoid unexpected expenses that threaten to put your financial future in jeopardy.