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Small Business Insurance
What Is Small Business Insurance?
Most small business owners need small business insurance. Having it can help protect the livelihood you’ve worked so hard to build. The right small business insurance will help cover expensive damage and lawsuits from:
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Accidents
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Natural disasters
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Professional errors
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Workers compensation claims
WHAT DOES SMALL BUSINESS INSURANCE COVER?
Depending on the coverage you choose, a business owners policy helps protect your business against things like financial losses and covered perils. Covered perils may include theft, fire, wind, falling objects and lightning. It's important to read your policy documents carefully to understand which coverages are included and what perils are covered by your insurer.
Each coverage in your BOP has a coverage limit. A limit is the maximum amount your insurer will pay for a covered claim. It's also important to note that each coverage in a policy is typically subject to its own limit.
And, some coverages may come with a deductible. A deductible is the amount of money you pay out of pocket toward a covered claim.
BUSINESS PROPERTY COVERAGE
The property coverage in a business owners policy helps protect your business's building and its contents against covered perils. For example, if there is a fire at your business, a BOP may help pay for building repairs (if you own the building). This coverage also helps replace business property, such as office furniture, computers or machinery.
Keep in mind that business property coverage will be subject to a deductible and limits. You can typically choose your property coverage limits based on the estimated cost to repair, rebuild or replace your business's property. But, if your losses exceed the coverage limit you chose, you'll then need to pay out of pocket to finish building repairs or replacement of your business's property. It's important to note that having insufficient policy limits may also result in a penalty. This is a fine you'd need to pay for not purchasing enough insurance. To help avoid penalties, make sure you purchase enough insurance to cover your business and its contents.
GENERAL LIABILITY COVERAGE
A business owners policy usually includes general liability coverage (sometimes called commercial general liability, or CGL). If a customer or visitor is injured at your business, and you're found liable, general liability coverage may help pay for the injured party's medical expenses. It may also help pay for legal costs if you're taken to court over an accident that occurred at your business.
Commercial general liability insurance is also subject to a coverage limit. That means if an injured person's medical bills exceed your coverage limit, you may have to pay out of pocket to cover the rest.
BUSINESS INTERRUPTION COVERAGE
Business interruption coverage, sometimes called business income coverage, is also typically part of a business owners policy. This coverage helps replace lost income and extra expenses if your business is affected by a covered peril.
For example, say a tornado or fire makes your office uninhabitable. Business interruption coverage may help pay for rent costs at a temporary office while repairs are made. Business interruption coverage may also help replace lost business income due to a covered peril. Similar to other coverages in a BOP, you will be subject to a limit. You may also be subject to a time period. This means the coverage may only last for 6 months, for example, so be sure to ask an agent about specific limits.
ADDITIONAL BUSINESS INSURANCE COVERAGES
There may be additional coverages you can add to your business owners policy. Some available coverages may include:
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Errors and omissions insurance (also known as miscellaneous professional liability insurance)
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Data compromise coverage
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Business auto insurance
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Employment practices liability coverage
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Equipment breakdown coverage
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Outdoor property coverage
Talk to your agent about your specific business insurance needs, so they can help you customize your policy with coverages that may work for your situation.
HOW MUCH DOES SMALL BUSINESS INSURANCE COST?
The cost of a small business insurance policy depends on many factors. These factors may include what kind of business you're insuring, the types of optional coverage you choose and the deductibles and limits you select for each coverage. Get a small business insurance quote or talk to an agent to get an idea of what you might pay for a policy.
Business Owners Insurance
What Is Business Owner’s Policy (BOP) Insurance?
A Business Owner’s Policy (BOP) combines business property and business liability insurance into one business insurance policy. BOP insurance helps cover your business from claims resulting from things like fire, theft or other covered disasters. Business owners insurance also helps cover claims that could arise from your business’s operation. These include claims of bodily injury or property damage. They also include claims related to personal and advertising injury.
Businesses can tailor their Business Owner’s Policy (BOP) to help meet their unique needs by adding optional coverages like:
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Data breach
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Business income for off-premises utility services
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Other specialized coverages
A BOP Policy is great because it can be custom-made to fit industry specific businesses. This means it’s great for businesses of any size especially small businesses. Package policies, such as a Business Owner’s Policy, are built to cover businesses that generally face the same risks. Customizing your BOP Insurance is an imperative first step when insuring your business. You should do this from the beginning to protect against loss and damages early on.
Who Needs a Business Owner’s Policy?
You should consider a business owner’s insurance policy if:
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Your business has a physical location. It doesn’t matter where you conduct your business, it matters if your business and assets have coverage. Your BOP policy can help cover businesses run out of your home, a rented or owned office, store or garage.
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There’s a possibility of you getting sued. For example, let’s say a customer who was injured at your work place slips and falls. Without the proper business owner’s insurance, you may be looking at hefty out-of-pocket fees to cover the customer’s medical expenses.
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You have assets that could get stolen or damaged. From digital assets and customer data, to equipment, furniture, cash or inventory, some assets can be very hard to replace. With BOP Insurance, you don’t have to worry about where the money is coming from in the event you have assets that got stolen or damaged.
BOP insurance will help keep you protected if your company has:
-Employees: Workers can accidentally injure customers or cause property damage. With this policy, you'll have protection for them and your business.
-Any chance of a lawsuit: If a customer slips and falls at your store, this can help pay their medical expenses and your legal costs.
-A physical location: Your BOP policy can help cover businesses run out of your home, a rented or owned office, store or garage.
-Assets that could get stolen or damaged: Digital property, equipment, furniture, cash and inventory are all difficult to replace without the right insurance.
-Private customer data: If someone steals or loses personally identifiable information, this can help pay expenses like notifying impacted clients and public relations.
What’s the Advantage of a Business Owner’s Policy?
Purchasing a BOP Policy is smart and convenient. It simplifies coverage needs by including business property insurance and business liability insurance. These are two important coverages combined into one.
The Hartford’s Business Owner’s Policy (BOP) offers businesses a way to save money while getting broad coverage for things like:
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Fire
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Theft
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Lawsuits
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Loss of income
Our BOP policy is a more affordable option than buying separate business property and liability policies. This policy is an even smarter and more convenient choice for business owners because you can add other coverages to it. Businesses with specific needs can tailor their BOP by adding coverages like:
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Business income for off-premises utility services
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Data breach
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Professional liability
What Does a Business Owner’s Policy (BOP) Typically Include?
Business owner’s insurance usually includes:
Commercial Property Insurance. Many of our carriers can help protect property your business:
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Owns
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Leases
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Rents
This can include:
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Buildings
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Equipment
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Inventory
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Furniture
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Fixtures
Commercial property insurance helps cover losses of accounts receivable, valuable papers and records.
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General Liability Insurance. When it comes to liability protection, the broader the coverage the better. To get the coverage you need, consider The Hartford's BOP policy. Our policy provides business liability insurance that helps you in the event that you’re sued for causing harm to a person and/or damage to property. It also helps cover the cost of your defense. It does this because businesses can be sued even when it’s not clear they were in the wrong.
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Business Income Insurance. If unexpected events cause a suspension in your business operations due to a covered loss, The Hartford's BOP policy can help. Our BOP can help replace loss of income to help you meet your continuing financial obligations. These include important monthly benefits to employees such as payroll and any other financial payments that are due to them. This also includes essential payments like rent.
Cyber Liability
What Is Cyber Liability Coverage?
Cyber liability insurance covers financial losses that result from data breaches and other cyber events. Most cyber policies include both first-party and third-party coverages. Some coverages may be included automatically while others are available "a la carte."
First-party coverages pay expenses your firm directly incurs as result of the breach, such as the cost of informing your customers about a hacker attack. Third-party coverages apply to claims against your firm by people or companies that have been injured as a result of your actions or failure to act. For instance, a client sues you for negligence after a hacker steals his personal data from your computer system and releases it online.
Examples of cyber policies are The Hartford's CyberChoice, Travelers' CyberRisk. and Philadelphia's Cyber Security products. All three provide a range of coverages and allow buyers to choose the ones they need.
First Party Coverages
Here are the types of first-party coverages you are likely to find in a cyber liability policy. These coverages may be subject to a deductible.
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Loss or Damage to Electronic Data - Covers the cost to replace or restore electronic data or programs damaged, destroyed or stolen in a data breach, whether the data belongs to your firm or someone else. Losses must result from a covered peril such as a hacker attack, a virus, or a denial of service attack. Policies may also cover the cost of hiring experts or consultants to help preserve or reconstruct data.
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Loss of Income and Extra Expenses - Covers income losses you suffer and extra expenses you incur to avoid or minimize a shutdown of your business after your computer system fails due a covered peril. Some policies, including the Hartford and Travelers policies cited above, cover dependent income losses. These are income losses you sustain when your network provider's system has been breached.
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Cyber Extortion - Applies when a hacker breaks into your computer system and threatens to commit a nefarious act like damaging your data, introducing a virus, initiating a denial of service attack, or releasing confidential data unless you pay a specified sum. Coverage typically extends to any extortion payment you make and expenses you incur in responding to the demand.
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Notification Costs - Covers the cost of notifying parties (voluntarily or as required by law) affected by a data breach. May also cover the cost of providing credit monitoring services and establishing a call center.
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Damage to Your Reputation - Some policies cover costs you incur for marketing and public relations to protect your company’s reputation following a data breach. This coverage may be called Crisis Management.
Third-Party Liability Coverages
The liability coverages afforded by a cyber policy are usually claims-made. Coverage typically applies to damages or settlements that result from covered claims as well as the cost of your defense. Note that defense costs may reduce the limit of insurance.
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Network Security and Privacy Liability - Covers claims against your firm for negligent acts, errors or omissions that result in a denial of service attack, unauthorized access, introduction of a virus, or other security breach of your computer system. Also covers claims alleging you failed to properly protect sensitive data stored on your computer system. The data may belong to customers, clients, employees or other parties.
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Electronic Media Liability - Electronic media liability insurance covers lawsuits against you for acts like libel, slander, defamation, copyright infringement, invasion of privacy or domain name infringement. Generally, these acts are covered only if they result from your publication of electronic data on the Internet.
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Regulatory Proceedings - Covers fines or penalties imposed on your firm by regulatory agencies that oversee data breach laws. Also covers the cost of hiring an attorney to assist in your response to a regulatory proceeding.
Inland Marine
Don’t let the term “inland marine” confuse you. As opposed to “marine insurance,” which covers products when transported over water, inland marine insurance covers products, materials and equipment when transported over land—e.g., via truck or train—or while temporarily warehoused by a third party. Collisions and cargo theft are the two most frequent causes of inland marine losses.
Does your business need inland marine insurance?
For many businesses, the property insurance provided by your Business Owners Policy (BOP) or Commercial Package Policy (CPP) may be sufficient. In general, these types of insurance cover property housed at a specific location, but tools and equipment that travel with employees to nearby job sites may also be covered. However, if your business frequently ships products or equipment, you may want to consider purchasing inland marine insurance.
This type of coverage is especially important if you ship high-value products or materials, which are often excluded from basic property coverage. Inland marine insurance can cover a wide range of specialty equipment and products, including:
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Computers, everything from servers to laptops.
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Communications and networking equipment.
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Construction and contracting equipment.
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Medical and scientific equipment.
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Photography equipment.
When weighing the need for inland marine insurance, consider the nature of your business and operations. Inland marine insurance isn’t just for companies that ship products to retailers and customers. For example, if you have a valuable tradeshow booth that is frequently shipped around the country and stored offsite by a vendor, you may want the protection provided by inland marine insurance. In addition, if someone else’s property is temporarily in your possession, inland marine insurance can provide coverage against the loss of this property. Special inland marine coverages include:
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Bailee’s Customer Coverage—Protects clients’ property that is left in the care of your business; e.g., if you operate a warehouse or repair shop.
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Builder’s Risk—Protects structures and materials during new construction projects or renovations.
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Exhibition and Fine Art Coverage—Keeps valuable items protected while on exhibit, in transit or on loan.
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Installation Floater—Covers materials from the moment they are loaded onto a truck until they are put to use or installed.
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Motor Truck Cargo Coverage—Keeps clients’ goods protected while your business transports and delivers them.
Your insurance professional can help you determine whether or not purchasing inland marine insurance makes sense for your business. If you opt for this type of coverage, your insurer may provide services to help you evaluate and minimize your inland marine risks and control losses.
Private D&O / Nonprofit D&O
Directors & Officers insurance is often overlooked by companies in the private sector, particularly from smaller and mid-sized companies. While non profits are generally more risk aware (due to an increase in claim frequency), their “for profit” counterparts generally operate under a belief that they are more insulated from litigation. Often this is a result of an unawareness that the courts are capable of piercing the corporate veil, able to pursue personal-accountability for corporate debts. Businesses may also operate under the false assumption that this risk is already mitigated through their general liability insurance which is false.
The potential for private company litigation is very real and D&O liability serves as the last line of defense protecting your directors/officers assets. It provides critical coverage to protect 1) the personal assets of the company's board members, 2) balance sheet protection by reimbursing the entity for claims after indemnifying its directors/officers, and 3) brand value and reputation. It is also often your only protection against regulatory actions and bankruptcy claims, and one of the few ways to afford your company some level of protection against reputational risk. Statistics compiled from Chubb and Towers Watson indicate that 27% of private companies have experienced a D&O related claim in the past 10 years (13% in the past 3 years) with an average cost of $700,000. Claims against private companies are most often asserted by:
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Employees: Employee claims asserting sexual harassment, failure to hire, wrongful termination and more. Trends include increased EEOC activity against background checks, new DOL overtime laws qualifying previously exempt employees and misuse of social media in the workplace
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Shareholders: Claims asserted by minority shareholders, class action claims, and derivative demands asserting fraud or breaching of fiduciary duties (among others)
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Investors: During crowdfunding campaigns and raises under Regulation D
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Regulators & Administrative Actions: Regulatory & Administrative investigations/proceedings and resulting fines and penalties including FCPA related actions
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Creditors: Bankruptcy & Creditor Claims
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Competitors: Alleging unfair competition, false claims such as lible/slander and false advertising (anti trust claims)
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Customers: Related to contractual disputes, harassment and discrimination, debt collection practices, advertising claims and others.
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Vendors & Suppliers: Such claims may arise from contractual disputes and disputes related to inventory management.
Worker's Compensation
Texas is different from most other states because it doesn’t generally mandate workers’ compensation insurance. However, this coverage is still an appealing option for most business owners, as it can pay for medical costs and partial missed wages from a work-related injury or illness. Companies that contract with government entities are required to have coverage.
What is workers’ compensation insurance?
Workers’ compensation insurance covers medical costs and lost wages for work-related injuries and illnesses. This policy is required in almost every state for businesses that have employees.
Does your small business need workers’ compensation insurance?
For almost all businesses in the United States, yes. Workers’ compensation insurance usually isn’t optional.
While workers’ comp laws vary by state, small businesses typically need a policy in place as soon as they hire their first employee.
Even when not required by law, this policy provides important protection against medical expenses and employee lawsuits related to workplace injuries.
You can rely on workers’ comp if an employee needs medical care or time off due to a workplace injury – or if an injured employee sues you for failing to prevent an accident.
If you don’t carry workers’ comp, your business will be responsible for any medical bills and legal fees. And most states levy costly penalties for noncompliance.
Small businesses find workers’ comp essential for three reasons:
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Most states require workers’ comp coverage.
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It covers medical expenses and partial lost wages due to a work injury.
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Most policies also cover the cost of employee lawsuits related to a work injury.
Why is workers’ compensation coverage important?
A serious workplace injury could financially devastate your business. Many small businesses can’t afford to pay medical bills out of pocket, whether it’s treatment for carpal tunnel syndrome or a broken leg.
Without workers’ comp coverage, both you and your employees are left in a difficult situation.
Does workers’ compensation protect against employee lawsuits?
In many states, yes. Most workers’ compensation policies include employer’s liability insurance to protect your business if an injured worker files a lawsuit against you for not preventing a workplace accident.
If an employee sues for negligence, your insurance company will pay for:
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Attorney’s fees
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Court costs
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Settlements or judgments
Does workers’ compensation help cover fatal accidents?
Yes, most workers’ compensation policies include death benefits. These help a deceased employee’s loved ones pay funeral and burial costs after a fatal workplace accident. Workers’ comp can also provide financial assistance for the deceased employee’s family.
Does workers' compensation cover employees who contract COVID-19?
It typically depends on where an employee contracted COVID-19 (the coronavirus).
Workers' comp insurance protects employees from on-the-job injuries and illnesses. If an employee contracts the coronavirus while working, then this policy should provide coverage. For example, a nurse caring for sick patients or a grocery store worker who deals directly with the public would both have a stronger claim than an office worker. Workers’ comp doesn't cover diseases unrelated to employment.
Where is workers’ compensation insurance required by law?
Each state has unique laws and penalties for workers’ comp. In most states, workers' comp is required as soon as a business hires its first employee.
Other states don’t mandate coverage until a business has two, three, four, or more employees. Texas is the lone state where business owners are never required to purchase workers’ comp.
All other states impose penalties for not carrying workers’ compensation. These can range from fines to jail time – or both.
Do self-employed business owners need workers’ compensation insurance?
Typically not by law. States generally require businesses with employees to purchase workers' compensation insurance.
But sole proprietors, independent contractors, and other self-employed business owners may buy this policy to fulfill the terms of a contract or to protect their income.
Most health insurance policies exclude coverage for work-related injuries and illnesses. If you carry workers' comp as an independent contractor, your medical bills will be covered when you’re injured on the job. Workers' comp can also partially replace wages lost while taking time off to recover from a work-related injury.
Why do certain clients require you to carry workers’ comp?
Your clients don’t want to deal with the expense and hassle of a workplace injury. That’s why they might require contractors who work for them to carry their own business insurance, including workers' comp.
This requirement limits legal liability for the client. Independent contractors with business insurance are more likely to seek payment from their insurance companies (instead of the client) if they are injured while working on a project.
Want to learn more about this policy? Find answers in our frequently asked questions about workers’ compensation insurance.
Commercial Auto
What does commercial auto insurance cover?
Commercial auto insurance helps cover medical payments and property damage related to an accident. This coverage includes legal expenses if you’re sued. A policy may also cover vehicle theft, vandalism, and other losses and damages.
Most commercial auto policies include liability insurance to cover your business’s legal costs if one of your employees gets into an accident.
Businesses that purchase commercial auto insurance often:
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Have a vehicle titled to their business
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Drive to and from worksites
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Carry tools, equipment, or products used for work
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Transport clients or employees
Does commercial auto insurance cover your employees’ personal vehicles and your own?
Commercial auto insurance does not provide coverage for personal vehicles. If you or your employees sometimes drive personal vehicles for business purposes, consider buying hired and non-owned auto insurance.
Hired and non-owned auto (HNOA) insurance provides liability coverage for vehicles your business uses but does not own. That includes:
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Employee-owned vehicles
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Vehicles leased by a business
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Vehicles rented by a business
What is the difference between commercial and personal auto insurance?
Commercial auto insurance policies are designed for commercial vehicles that cover a lot of ground. Policies typically have higher coverage limits to account for the increased risk. Personal auto insurance policies only cover claims related to personal use, including your commute and travel unrelated to work. They have lower limits and usually cost less.
If you’re involved in an accident while driving your personal vehicle for work, your insurance company might refuse your claim. That’s why sole proprietors who own a vehicle used for work should consider commercial auto insurance or HNOA.
If you’re uncertain which policy you need, check with an insurance agent.
What coverage options should a commercial auto policy include?
At a minimum, your policy must meet state requirements. Your policy should also be able to cover all costs associated with an accident. Otherwise, you could end up paying legal fees and other expenses out of pocket.
Talk with an agent to discover policy options that match your driving situation. Options that cover different risks include:
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Collision coverage, which covers physical damage to your own vehicle in an accident
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Comprehensive coverage, which covers vehicle theft and damage from vandalism, fire, and other causes
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Uninsured or underinsured motorist coverage, which covers damages incurred by another driver who is not adequately insured
You can control the cost of your commercial auto policy by adjusting your deductible. A policy with a higher deductible will cost less, but you’ll have to pay more before you can collect on a claim.
All business-owned vehicles in Texas must be covered by commercial auto insurance. Texas requires a minimum of $30,000 bodily injury liability per person, $60,000 bodily injury liability per accident, and $25,000 property damage liability per accident.
Though it's not required, personal vehicles driven for work purposes should be covered by hired and non-owned auto insurance, as personal auto policies usually exclude business use. It can be added to general liability insurance or a business owner's policy.
Liquor Liability
What does liquor liability insurance cover?
If your business sells or serves alcohol to a visibly intoxicated person who then causes injury or damages, liquor liability insurance can pay for legal fees, settlements, and medical costs.
Liquor liability insurance can help cover:
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Third-party bodily injury
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Third-party property damage
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Legal costs
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Additional claims, such as assault and battery
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Third-party bodily injury
Liquor liability insurance does not cover:
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Libel and slander
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Damage to your business property
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Incidents related to underage drinking
Errors and Omissions
What is E&O insurance?
Errors and omssions (E&O) is the insurance that covers your company, or you individually, in the event that a client holds you responsible for a service you provided, or failed to provide, that did not have the expected or promised results. For doctors, dentists, chiropractors, etc., it is often called malpractice insurance. For lawyers, accountants, architects or engineers, it may be called professional liability. Whatever you call it, it covers you for errors (or omissions) that you have made or that the client perceives you have made.
Most E&O policies cover judgments, settlements and defense costs. Even if the allegations are found to be groundless, thousands of dollars may be needed to defend the lawsuit. They can bankrupt a smaller company or individual and have a lasting effect on the bottom line of larger companies.
In short, E&O coverage provides protection for you in the event that an error or omission on your part has caused a financial loss for your client.
Who needs E&O insurance?
The best-known professionals who need E&O insurance are doctors, lawyers, accountants, architects, engineers, etc. However, less thought about individuals range from advertising agencies to commercial printers, Web hosting companies to wedding planners. If you are in the business of providing a service to your client for a fee, you have an E&O exposure. You may want to consider what will happen if the service is not done correctly or on time, and it costs your client money or harms their reputation.
Why does my company need coverage?
To put it very simply, everyone makes mistakes. Even with the best employees and the best risk management practices in place, mistakes will be made. No one is perfect.
If a freight forwarder sends a shipment to South America instead of South Africa and it is a time sensitive shipment and their client loses a sale and, therefore, hundreds of thousands of dollars, who will pay the loss?
If a wedding planner reserves the reception hall, the band, the caterers, etc., for May 22 instead of May 29 and everyone shows up except the wedding party and guests, who pays? And imagine the emotional distress caused to the bride if this were to happen!
There is also the less tangible loss of reputation for both the professional and his client. What will the cost be to the business that now has equipment in South America instead of South Africa? Will they lose future contracts with their current client as well as future clients?
By not purchasing E&O a company can be taking a serious financial risk. These types of losses are not covered under a general liability policy. And, as stated earlier, even if you are not at fault, litigation is both time consuming and expensive.
When should you buy E&O insurance?
As with any insurance, the best time to buy an E&O policy is before the risk is taken. If you are in the service industry and you know you will have the exposure, make E&O insurance a part of your insurance portfolio. Many contracts with clients will require insurance to be in place. In some cases, it is a selling point with your clients. It gives them the peace of mind of knowing they will be compensated if there is an error or omission.
Builder's Risk
What does builder’s risk insurance cover?
Builder’s risk insurance covers the costs of repairing an unfinished structure or replacing building materials when weather, fire, vandalism, or theft hits a construction site.
Builder’s risk insurance provides coverage for:
1. Structural damage from weather
Builder’s risk insurance covers the cost of damage caused by non-severe weather events, such as wind, rain, and hail.
Example: Freezing rain damages the lumber on a construction site. The carpenter is responsible for replacing it, so he turns to his builder’s risk insurance to cover the cost.
2. Fire damage
A fire at a construction site could severely damage building materials or an unfinished structure. Builder’s risk insurance covers the cost of replacing or repairing items damaged by fire.
Example: A fire sweeps through a construction site, scorching the siding of an unfinished building. To replace the siding, the general contractor makes a builder’s risk insurance claim.
3. Vandalism
A vandal can set a construction project back months by breaking windows, destroying fixtures, and spray painting walls. If your construction site is vandalized, builder’s risk insurance can reimburse you for the damage so you can continue working on the project.
Example: A vandal pulls the electrical wiring from an unfinished building, forcing the electrician to rewire the entire structure. The electrician's builder's risk policy helps cover the repair costs.
4. On-site theft
Because construction sites are often left unguarded, they are a common target for thieves. Builder’s risk insurance can help compensate you for stolen materials.
Example: A thief breaks into a construction site and makes off with thousands of dollars' worth of copper pipes. The plumber uses builder’s risk insurance to replace the pipes.
Builder’s risk insurance does not usually cover:
1. Damage from natural disasters
Builder’s risk insurance doesn’t usually cover the damage caused by natural disasters like floods, earthquakes, or tornadoes. To cover these types of events, add a severe weather endorsement to your policy.
2. Damage to tools and equipment
Damage to tools and equipment is not covered by builder's risk insurance. Contractor’s tools and equipment insurance helps pay to repair or replace lost, stolen, or damaged tools and equipment valued under $10,000.
3. Damage due to faulty design or materials
Builder’s risk insurance doesn’t cover damage to an unfinished structure that results from faulty design, construction, or materials. Professional liability insurance for construction workers and contractors helps protect your business from these liabilities.
4. Employee injuries
Builder’s risk insurance does not protect employees from injuries or illnesses related to work on a construction site. Workers’ compensation insurance helps pay medical costs and partial lost wages resulting from work injuries and occupational illnesses.
Commercial Umbrella
What does commercial umbrella insurance cover?
Commercial umbrella insurance can increase the limit of three policies: general liability insurance, employer's liability insurance, and commercial auto liability insurance. It protects against the most expensive liability lawsuits.
Commercial umbrella insurance can provide additional coverage for:
Third-party bodily injury
When you add commercial umbrella (excess liability) insurance to your general liability insurance, it can cover medical or legal expenses if someone injures themselves on your business’s property.
Third-party property damage
When you add commercial umbrella insurance to a general liability policy, it helps repair or replace damaged customer property.
Employee injuries
When you add umbrella liability insurance to employer's liability insurance (typically included in workers' compensation), it helps guard against employee lawsuits over work injuries.
Auto accidents
When you add umbrella liability insurance to a commercial auto insurance policy, it helps cover costs if someone sues for damages caused by your vehicle.
Commercial umbrella insurance does not cover:
Damages within the underlying policy limits
Umbrella liability insurance does not become active until the underlying policy has reached its limits. And as with any policy, it does not provide coverage beyond its own policy limits. Learn more about how umbrella insurance works.
Professional errors
Professional liability insurance, also called errors and omissions insurance or malpractice insurance, can cover lawsuits over professional mistakes, including undelivered services and missed deadlines. Umbrella liability insurance cannot be added to this policy.
Employee discrimination lawsuits
Employment practices liability insurance (EPLI) can cover lawsuit expenses related to claims of harassment, discrimination, and wrongful termination. Umbrella insurance cannot be added to this policy.
Business property damage
The commercial property insurance portion of a business owner's policy can help pay for expenses to repair or replace your business property when it's damaged by fire, theft, and some weather-related events. Umbrella insurance can only be added to liability policies, not property insurance.
Umbrella insurance covers risks other policies ignore
Umbrella liability insurance sometimes covers risks that your liability policy excludes. For example, most general liability insurance policies don’t include liquor liability insurance, but an umbrella policy might. Talk to an Insureon agent to find out which type of umbrella insurance best fits your business.