Insurance Basics: Everything You Need to Know

4 Faqs About Business Insurance From New Policy Holders

In almost every type of business, it is important to carry business insurance. This type of insurance covers liability, ensuring that if you cause damage to a customer or their property, you do not have to pay. As you go about purchasing this type of policy, you will probably have some questions -- including the following.

1. How much coverage do you need?

That depends on what services your business offers and the risk of you causing damage with those services. A good starting point is usually $1 million in liability coverage. If you are in a more dangerous industry, like a medical field, or if you are working on very valuable properties worth multiple millions, you may want a higher limit. Your insurance agent can evaluate your risk and recommend the proper level of coverage for you.

2. Are employees covered under the policy?

In most cases, yes, any work done by one of your employees falls under your insurance policy. So if an employee accidentally knocks a tree though someone's window while trimming it, the policy will cover the damage, just as it would if you were to have knocked the tree yourself. Damage done by independent contractors working under your direction is also covered, though the contractor should also have their own insurance to protect themselves in case of injuries.

3. What is D&O liability insurance?

If your insurance agent recommends this type of policy to you, then you may be a bit confused. The D&O stands for directors and officers. This is just a specific type of business liability insurance that is often carried by larger, publicly owned companies. It protects you in the event that someone sues you for failure to perform your job duties. A stockholder or employee would typically be the one to sue. If a D&O policy is recommended to you, it would be in addition to the general liability insurance you carry.

4. What is network risk insurance?

This is another type of insurance that is being recommended for businesses today. If your business uses social media or the internet for marketing, you should definitely consider this type of coverage. It protects you in case anyone sues your business based on your social media posts or other online usage.

To learn more about business insurance and the specific types of coverage you need, reach out to an insurance agent in your area, such as at Boone Ritter Insurance.