| NYC Business Group
What is the Difference Between Commercial and Business Insurance
Successful business owners understand the importance of insuring their businesses.
Business coverage can save you a lot of money and give you peace of mind.
Have you ever thought of some scenarios that may change your business forever? What would happen if?
Some scenerios to take into accountability is,
- A customer or employee slips and injures himself in your business premises?
- Your products cause injury or financial loss to your customer because they are faulty?
- A natural calamity, for example, an earthquake or flood, damages your offices?
- The vehicle you use to do business is involved in an accident?
Business and commercial insurance coverage helps you get back on your feet after a disaster, lawsuit, or accident. Also, in most states, commercial insurance is a necessity. Remember, as a business owner, it is essential to understand the differences between commercial and business insurance, the cost of each, and what is covered by each insurance policy.
What is Commercial Insurance?
Also known as business insurance, commercial insurance protects a business owner and the employees from any problems that could affect the business, for example, injury risks. The insurance policy covers any unforeseen events/risks that could interrupt a business.
Since businesses are different, commercial insurance policies are also different. It is impossible to find a commercial insurance policy that covers all types of businesses! Therefore, researching and seeking help from a reputable insurance broker can help you make an informed choice. Sole proprietors are required to have commercial insurances. However, determining the right insurance policy that will protect and benefit your business is a daunting task. Our dedicated Brokers can help you determine what coverage your business needs, Call Us Today!
Commercial vs. Business Insurance
Although the two terms seem different, they mean the same things. Therefore, they can be used interchangeably. It is common for business owners to confuse the two terms, but if you are keen, you will notice that the two are a category of insurance that provides coverage to all businesses. Regardless of the insurance coverage, you will choose, they serve the same purpose, protecting your business.
Which are the Most Important Types of Commercial and Business Insurance?
It is crucial to understand that there are must-have insurance coverage and optional ones if you run a business. The must-have insurance coverage includes the following:
1. General Liability Insurance/Commercial General Liability (CGL)
Every business should have general liability insurance because it offers a wide range of benefits. CGL will help you cover:
- Settlements, judgments, and court costs for all covered claims.
- The cost of a property damage claim against your business.
- Medical expenses in case someone is injured on your business premises.
- Administrative costs to handle any covered claims
However, general liability insurance does not cover:
- Personal injury claims made by your employees/worker.
- Damage to your office or equipment
- Auto accidents caused by either you or your employees at work, i.e., if the vehicle involved is used for business purposes.
2. Worker's Compensation Insurance
This insurance covers medical expenses and lost wages as the employees recuperate from an illness or injury. In most states, it is mandatory to have workers comp if you have at least one employee. The primary purpose of this insurance policy is to protect your employees against any financial losses if they are ill or suffer injuries in your workplace.
Since workers comp is under a 'no-fault system,' an employee doesn't have to prove that the illness or accident was someone else's fault. The employee will be compensated for any injuries or illnesses sustained on the job. Employers looking for worker's compensation insurance have these options:
- Self-insure – using an experienced insurance broker to purchase workers comp from a reputable insurance company.
- Sourcing via the State Compensation Insurance Fund (also known as State Fund). The State Fund will provide you with a reasonable workers comp, thus helping you save money.
3. Commercial Property Insurance
The policy's main objective is to protect your business's physical assets from fire, theft, explosions, vandalism, burst pipes, and storms. Typically, floods and earthquakes aren't covered by commercial property insurance unless you opt to include them in your policy.
4. Professional Liability Insurance
If you are sued for negligence, violation of good faith, inaccurate advice, misrepresentation, or fair dealing, professional liability insurance can protect you. Sometimes, the E & O can cover privacy violations that may threaten your business. It is a good insurance policy to invest in.
5. Umbrella Business Insurance
When you feel that your business is at a higher risk of being sued or is in a litigious state, it is crucial to haven umbrella business insurance. The insurance exceeds the limit offered by your commercial insurance policy. Therefore, it will help you cover any liabilities that may occur at any given time.
Bottom-Line;
There is a misconception where some people assume that business insurances are ideal for small companies because they can run out of business when sued or hit by a disaster. On the other hand, some people think that large corporations are the ones in need of commercial insurance because they can afford it. That is not true! Both small and large companies need commercial business insurance to protect their businesses.
To avoid spending a lot of money on an insurance policy that will not benefit you, it is advisable to seek help from an insurance agent. Speaking to a reputable insurance agent, you will understand the different types of insurance policies you can invest in, the estimated amount of money you will spend, and how these policies will benefit your business. Working hand in hand with an expert, he can help you manage your insurance cost, save time and find a custom commercial/business insurance plan that will suit your budget and needs. Typically, commercial insurances have different packages to suit different businesses.
Finally, commercial insurances come in many forms, and the insurance policy you need will depend on your business. However, if you are keen, you can find a plan that suits your budget and needs. It all takes time, hard work, and patience, this is why it is best to seek help from professionals. Get a Quote From Our Agency, Our Professional Brokers will Take the Confusion Out of Finding the Right Coverage!