When planning to start an online business you will still need to get some type of business insurance. You may think that it is not necessary since you do not have a normal brick and mortar building, but that is far from the case. People do not care if you work remotely, or if they deal with you face to face, if something goes wrong, they will demand retribution in one way or another. If you have employees, not independent contractors, you will still be required to cover insurance for them in case they get harmed. As long as they are “clocked in” they are under your business.
With that in mind, let’s go over the basic kinds of insurance that you will need, and why you need it.
Table of Contents
General Liability Insurance
This is your main type of insurance that will cover most instances that could happen. It is the one policy that you should have, no matter what. Most areas will require you to have this before you can even start operating a business, so make sure that you get the levels that are required. The reason it is important is that it will cover your business against any lawsuits that may come up, any slander that you may be accused of, bodily harm to yourself or others (even though you work from home if anyone comes onto your property and gets hurt it is on you to make it right), and any property damage that may occur.
Product Liability Insurance
If your home business is based on products that you sell, manufacture, or wholesale, you will want to consider getting this coverage. It will cover you against any circumstances that your consumers may have to happen, such as a young child swallowing a toy that you claim was safe for their age. Simple things can cause your business big problems. Check with an insurance company to see what they will cover. If you are still looking for a good agent in your area make sure you use the iSelect platform to help you narrow some down.
Professional Liability Insurance
This will protect you and your business from any monetary loss due to malpractice, negligence, or errors that cause your customers any issues. For example, if you are running a self-improvement business from home and give some bad advice the person on the other end could sue for negligence or malpractice. This policy would cover that, so you do not have to pay any damages out of your pocket.
Commercial Property Insurance
You may think that since you do not have a traditional type of building for your business this policy is not important. But you must think outside of that little box and realize that accidents happen. Pipes break or freeze, roofs leak, and Mother Nature loves to throw different things at us all. If you work from home most of the policies will require you to have one set room for your business before they will cover it under this policy. The same that most local tax write-offs will require.
Home-Based Business Insurance
This policy is an add-on policy that connects with your home insurance. It only covers a small amount, but your home insurance should cover most anything that is around you, that is not related to your home business. This policy will only cover instances that occur to your business equipment, or against any personal liability issues.
Business Owner’s Insurance
This is the best of all the options listed. It is a combination of them all, making it easy for you to get the coverage you need, without having to pick and choose. This policy will be focused on your specific business, covering anything that may come up during your operations.
These are the six basic types of business insurance. Working through the use of the internet is becoming a widespread practice. As people embrace the fact that we are in the technological age and consumers are opting to conduct more of their business online, small companies are shifting how they run their businesses.
Even the big corporations are shifting more focus towards online platforms, and less towards their in-person operations. Make sure that you get the proper insurance coverage and review it every year to make sure any additions that you may have are still covered.
