People and their cars aren’t the only things that need insurance. Businesses across the country rely on commercial insurance to protect their assets, employees and the company itself.
This type of insurance protects companies against different types of commercial financial risks. For example, this could include an injured employee, consumer lawsuit or even a natural disaster. Every state sets their own commercial insurance requirements.
Who Needs this Insurance?
While most states do not require commercial insurance, they do require companies to have unemployment and workers’ compensation insurance. Certain states may even require the company to carry disability insurance. This type of insurance would be expected in certain industries, such as construction or manufacturing. However, all companies can benefit from having certain types of business insurance.
Types of Coverage
General liability insurance is the most common type of insurance that companies purchase. It protects the company against a host of different legal problems, such as claims regarding accidents, negligence and property damage. Most policies also protect against libel, slander and settlement bonds. Product liability insurance is popular among any company that manufactures, distributes or sells products. Certain companies, like auto or electronics companies, will need more coverage. Professional liability insurance is used by certain professions, such as law or medicine, to protect against malpractice lawsuits. Finally, commercial property insurance protects against any loss or damage to the company’s property.
How Does it Work?
Insurance claims for businesses are similar to vehicle or medical insurance. That is, the company files a claim with supporting documentation and the insurance company verifies the claim. Companies are cautious about filing claims because it may result in their rates being raised. On the other hand, insurance companies tend to work closely with businesses in order to ensure a timely claim process and avoid frivolous claims.
Business insurance provides vital financial benefits to businesses. First, this insurance is one of the best risk management tools. It protects against many forms of legal, financial and commercial risks. Therefore, insurance for businesses is one of the best ways to protect the company and employees for legal troubles and financial woes.