Business insurance or commercial insurance shields organizations from losses suffered due to unanticipated events that occur during regular business operations. Business insurance covers all losses resulting from events beyond organizational control, like lawsuits, accidents or natural calamities. There are various types of commercial insurance for companies, including coverage for property loss, legal expenses, and employee related risks. As per Charles Spinelli the following are the different types.
Types of Business Insurance
Companies anticipate their business insurance requirements based on possible losses, which can vary depending on the type of business and its condition. Different types of business insurance products include:
- General Liability Insurance-This type of insurance covers legal spending for events connected with injuries, mishaps or claims of discrimination. General liability insurance protects against costs from physical injury, distortion, depreciation, medical expenses and the cost of contesting petitions.
- Commercial Property Insurance- Commercial property insurance focuses only on the company’s property. Commercial property insurance policy should include protection from climatic conditions such as wind and hailstorm. It should also cover damages from fire, smoke, demolition and theft.
- Extra Expense Insurance-This insurance policy pays for unusual expenses after a unexpected event damages workplace. This funds normally go towards repairs and property renovation.
- Product Liability Insurance-Product liability insurance helps to protect a company against damages resulting from negligence that can cause serious physical injury to the purchaser.
- Business Interruption Insurance-This covers lost earnings and extra expenses if any organization is temporary unable to perform due to an insured event or losses caused by fire, storm, or theft.
- Professional Liability Insurance-This insurance policy provides security from risks such as faults, distortion and inefficiency.
- Group Health Insurance-Group health insurance plans cover groups of two or more people. Generally, an employer, two or more employees, and their families. This insurance plan includes plenty of coverage but not limited to medical, dental, vision, life and long-term and short-term disability insurance.
- Business Owners Policy- This insurance product combines general liability insurance, commercial insurance and business Interruption insurance for a wider area of coverage. According to Charles Spinelli, this policy is much more attractive than other plans and a reasonable choice for small business owners.
- Employers Practices Liability Insurance-This form of insurance is planned to protect businesses against employee claims regarding ignoring of their legal rights as workers. Among claims covered by employee practices liability insurance are unlawful winding up, defects in employment, charges of sexual harassment, failure to promote and distortion of employee benefit plans.
- Commercial Umbrella Insurance- Commercial umbrella insurance is like an add on to the current insurance coverage it provides additional safety to the organization if managers predict that regular insurance limits won’t cover massive losses or damage.
- Workers Compensation Insurance- Workers compensation insurance provides coverage for businesses with employees in most cases. This can help pay for lost wages and medical expenditure for employees with work related disease or mishap. It is compulsory for all businesses with employees to hold workers compensation insurance. Not having workers compensation insurance where directed is a criminal activity, and the fines can be huge.
- Cyber Security Insurance:- It provides liability coverage to businesses that undergo data theft, wire fraud, a ransomware attack or fall target to other types of cyber crime. It may also cover the cost of informing and providing services to customers suffering from data breach, as per Charles Spinelli.
Business insurance is thus the foundation of a company’s risk management strategy. Business insurance is a protective net that enables business owners to focus on development and success by safeguarding assets. Additionally, it helps them in managing risk liability and guaranteeing business continuity.
