Insurance Questions and Answers for Small Business Owners

If you’re a small business owner, your business and personal assets need protection from the unexpected costs of running a business. Those include accidents, natural disasters and lawsuits. In some cases, insurance is legally required. The US Small Business Administration has put together a guide to insurance for small business owners. Here are some of the top Questions and Answers.

How Do I Pick the Type of Business Insurance I Need?

You should generally insure your business against things you wouldn’t be able to pay for on your own.

There are also some kinds of insurance that are required. The federal government requires every business with employees to have workers’ compensation, unemployment, and disability insurance. The state of Arkansas also requires additional insurance in some cases, depending on the type of business.

Farris Insurance can help you figure out what kinds of coverage makes sense and is required for your business. We can help you compare terms and prices to find the best deal for you.

What Are the Common Types of Insurance for Small Business Owners?

Here are six common types of insurance and what they cover:

General Liability Insurance protects small business owners against financial loss as the result of bodily injury, property damage, medical expenses, defending lawsuits, and settling judgments.

Professional Liability Insurance protects against financial loss as a result of malpractice, errors, or negligence. It’s for businesses that provide services to customers.

Commercial Property Insurance protects your business against loss and damage of company property due to fire and smoke, wind and hail, or vandalism. 

Product Liability Insurance protects against financial loss as a result of a defective product that causes injury or bodily harm. It’s for businesses that manufacture, distribute or sell products.

Home-Based Business Insurance offers protection for small business equipment and liability coverage for third-party injuries. It can usually be added to your homeowner’s insurance.

A Business Owner’s Policy is an insurance package that combines all of the typical kinds of coverage into one bundle. It simplifies the insurance buying process and can save you money.

What Are the Steps to Buying Business Insurance?

First, you should assess your risks. Think about what kinds of accidents, lawsuits, or disasters that could damage your business. You should make sure you’ve insured every aspect of your business.

Second, you should find a reputable licensed agent. Farris Insurance can fill that role for you and is interested in your needs. We have a decades-long history of serving Northwest Arkansas businesses.

Third, our agents can help you compare rates, terms, and benefits from different insurance carriers.

Fourth, you should re-assess your insurance annually. As your business grows, your liabilities may grow as well. If you have new equipment or you’ve added operations, you should contact your agent to discuss how those changes affect your insurance.