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Personal Liability
We all have responsibilities when it comes to living in a society.  If you own a home, you must maintain it properly to avoid affecting the value of other properties in your neighborhood.  If you drive a car, you must operate it in a reasonable manner to make sure you are putting no one at risk of injury.  If you own a company, you must conduct business in a fair and safe manner.  Failing to abide by these societal expectations can cost you, both personally and professionally. The purpose of insurance is to protect the person or the business entity from financial harm.

Business Insurance Plan
Owners of a business should have a plan to protect the assets of the company as well as those of the individual owners.  While there are many types of insurance for small business, here are the primary categories:

• Property insurance
• Liability insurance
• Health insurance

Business Property Insurance
Property insurance offers protection against loss or damage, whether by theft, natural disaster, or accident.  A policy will protect both the physical building and its contents, and most insurers will cover items that are lost or stolen even after they have been removed from the premises—a laptop computer that accompanies you on a business trip, for example.

Three Basic Types of Business Liability Insurance
Even as the “protected” owner of a corporation or LLC (limited liability company), there are still circumstances where you can be held personally responsible for damages.  For example, you may have signed a personal loan guarantee for your business.  You may have caused an injury to someone through direct action or negligence, or did something illegal or irresponsible.  In these instances, the corporate umbrella may not protect you from suit.

• General liability
  This insurance covers any bodily injuries that may take place in your facility, whether they affect employees, customers, or suppliers.  It also protects against damage caused by an employee—a delivery driver denting someone’s awning, for example—or injuries inflicted on someone due to an employee’s actions.

• Professional liability
  This insurance offers protection to professionals that provide certain services to clients.  Medical malpractice insurance is one example in this category.  Other professions typically electing this coverage are attorneys, accountants, financial advisors, and general contractors.

• Product liability insurance
  This insurance is especially valuable to anyone whose company manufactures a product.  It protects the firm if your manufactured goods cause injury or financial loss to someone who uses it.

Business Health Insurance
Whether you have many employees or you are the only one, a business health insurance plan is vital.  A number of different plans are available to the business owner, depending upon the size of the business and the amount and type of coverage desired.  These can be divided into two basic categories.  Individual plans can be for the employee only or may include his or her spouse and family.  However, each person to be covered must qualify individually, which means that the insurance company can decide that someone is ineligible based upon prior or existing health issues.  Group plans can also apply to an employee or include the family, but everyone is accepted regardless of pre-existing conditions.  As a result, group plans are usually quite a bit more expensive.

Conclusion
No small business can effectively function without having the proper amount and type of business insurance coverage.  The Business Owner’s Policy (BOP) may prove to be your best choice, as it combines property coverage with general liability coverage at a rate usually quite a bit less than purchasing both types separately.  Insurance for small business is vital to its financial future.  Make sure to consult a professional, who will help you decide exactly what sort of coverage is appropriate to your company’s size and revenue stream.

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