Despite economic downturns and the lingering effects of the COVID-19 pandemic, there are still 33.2 million small businesses actively pursuing business in the United States. However, while nearly 80% survive one year, only 25% make it to fifteen years in business. With nearly 48% of people in the U.S. employed by small businesses, this is a figure that affects more than just business owners.

Most small businesses fail due to cash flow and financial management issues, some of which can be tied to not adequately protecting small business assets. While your state may require specific insurance, there are several types of insurance that can help you better protect your assets and keep cash flowing in the event of an emergency.

 

Types of Small Business Insurance

Fortunately, there are many policies that can help your small business stay protected — and even thrive — in the event of an emergency. Here, we will explore some of the most common. 

 

General Liability 

While businesses are generally not required to carry this policy, it can help protect your assets — both business and personal — from being seized if there is a judgment against you for property damage or bodily injury.  

 

Commercial Property 

Commercial property insurance is important if you own or lease the building in which your business operates. If things like theft or fire damage occur and impact your business operations, this policy will help you continue to pay bills and meet payroll obligations during the repair and recovery period.  

 

Worker’s Compensation  

If your employees are hurt or get sick on the job, this insurance will help provide them with medical and wage benefits. Additionally, it protects you from lawsuits filed by employees who are injured in the workplace.  

 

Employment Practices 

Employment practices liability insurance (EPLI) helps to protect your business assets from claims from employees who declare their legal rights were violated in your workplace. EPLI covers lawsuits stemming from allegations such as discrimination, breach of contract, sexual harassment, wrongful termination and more. As the U.S. Equal Opportunity Commission (EEOC) gains more traction, lawsuits of this type may be on the rise, so EPLI will be more important than ever. 

 

Product Liability 

Have a product for sale? You might want to purchase product liability insurance to protect assets in the event a defect in your product causes damage to property or bodily injury. 

 

Key Employee 

Employees are the lifeblood of your small business. If a key employee becomes disabled or even dies, it can significantly impact your ability to do business. Key employee insurance is a life insurance policy on a significant employee that will help you to recoup their financial contribution to the company in the event of their inability to work. Of course, the employee must be involved in and agree to the purchase of the policy.  

 

Business Vehicle 

Your personal auto insurance policy will not cover all claims stemming from the use of a business vehicle. If you have a personal vehicle that you use primarily for business purposes, then you will want to have this policy. It’s also important to have if you operate with a fleet of vehicles or if employees drive company-owned vehicles.  

 

How to Choose the Right Small Business Insurance Products for Your Business 

When choosing the many small business insurance products available, you will need to assess your business’s risk factors to make a more informed decision. A licensed insurance agent will be an important resource during this process, as they can help you find the right products for your needs at the most cost-effective level.  

Finally, you will want to assess your coverage every year. As your business grows and changes, so will your exposure to risks and liabilities. In addition, as you expand, new locations, equipment, and even a larger labor force may cause you to adjust coverage amounts and types. Also, be sure to explore packages of policy, such as business owners’ policy (BOP) packages, which can combine several policies — such as liability, business interruption, and property insurance — into one. 

 

Help Your Small Business Stay Protected 

Running a small business is difficult, and staying afloat in these uncertain economic times is even harder. Make sure that your business is prepared for potential disruptions by ensuring your business assets are properly protected with insurance products designed specifically for small businesses.  

At Schuetz, our small business insurance experts have been helping local businesses thrive for decades by providing the right advice on purchasing reliable, cost-effective insurance products. Contact us today to explore the many ways our small-business-centric insurance policies can ensure your business assets are secured in the event of disaster.