Thousands of cars are alike. Several homes in the same neighborhood are alike. But no two businesses are alike. Two franchise restaurants will be in different neighborhoods, but they might keep different hours and have different sizes of staff. So, there's no one-size-fits-all solution to business insurance. If you're insuring your business, your plan is going to be custom-designed. Every aspect of insurance will be dramatically different, depending on such details as the size of your business, your industry, and where you're stationed. If you own a business in Massachusetts, here's what you need to know.
- Liability Insurance. The foundation of your business insurance coverage is liability insurance. General liability insurance comes down to bodily injury and property damage for which you may be held responsible — either because an incident happens on your property or because it happens in the course of your business operations. You're looking at different measures of liability depending on the size of your business. A small company should carry between $500,000 and $1,000,000 in general liability coverage. Larger companies may want to invest in umbrella insurance and excess liability coverage.
- Workers Compensation Insurance. This is simple enough to explain: The more employees you have, the more workers compensation protection you need. If you run a business solo or rely wholly on freelancers and contractors, then workers compensation coverage is not a concern.
- Property Insurance. You might need a considerable amount of property insurance for running a big restaurant. However, you might not need this if you work out of a home office.
- Special Concerns. Every business relies on different tools of the trade, or different methods of operation. Your business insurance plan may or may not include any of the following:
- Equipment Breakdown Coverage. If you have machinery that may require replacement or repair at some time in the future, you'll need to invest in Equipment Breakdown Coverage.
- Commercial Auto Insurance. If you frequently use your personal vehicle for business purposes, your insurer may come to regard it as a business vehicle. If this happens, you’ll want to make sure that your insurance policy reflects that classification.
- E&O (Errors & Omissions) Insurance. If you make a mistake on a contract or invoice, this coverage can be a big help.
- D&O. Directors & Officers Insurance. If you have a board of directors, D&O coverage can protect the company from any of the mistakes they make.
Because every business is so dramatically different from other ones, the best way to determine what you need is to talk to a business insurance agent.