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As a small business owner or independent contractor, you’re constantly working through the hurdles of the workweek — whether it’s hitting deadlines, managing employees, or ensuring that you’re generating enough income to support yourself and your growing business. In all likelihood, the last thing on your mind is how to get business insurance.
Business insurance can protect everything you’ve worked so hard to build. This easy-to-follow guide will help you understand the main types of business insurance coverages available, how to get business insurance, and which policies to buy.
But, first, you might be asking yourself . . .
Why do I need business insurance?
Running a business or working for yourself is inherently risky. Just one mistake could set you back, especially if it eats up time and money otherwise meant for growing your operations. Claims of third-party property damage, bodily injury and negligence are a few reasons why every business or contractor needs to have some form of business insurance policy.
For instance, you accidentally damage your client’s property while you’re working. Or, your client accidentally gets injured while you’re rendering services and blames it on you. Lastly, what if you have a fickle client who is displeased with the work provided, claiming that you breached your contract or your work caused them a financial loss?
Without business insurance, you have no safeguard in place from the financial impact of these scenarios. The reality is that all businesses can benefit from insurance coverage.
How do I get business insurance?
The first step is understanding your specific liabilities and the types of risk your business faces. The last thing you want is to purchase a policy, pay for it over a long period of time, and then find out that you weren’t properly covered once you finally have to file a claim.
First, complete a business risk assessment. Be honest about your real exposures, as it can make a difference in your coverage.
Think about your company or practice. What kind of services do you render? Do clients come to your office, do you visit their property, or both? What are the common risks associated with your line of work? Ultimately, what are probable situations in which things can go wrong?
You don’t need to be an expert to understand the exact type of insurance you need. If you know what or where your main risks are, then consider general and professional liability insurance as your starting points.
How to get general liability insurance
General liability insurance is one of the most important types of coverage available for small and medium-sized businesses. It covers non-employee bodily injury and property damage incurred by a third party, as well as personal and advertising injury. If a client or another third party is injured or sustains property damage in an accident related to your business, you could be sued. This is where general liability insurance can help.
General liability insurance will also provide your legal defense and the settlement of any covered claims so that your bottom line doesn’t take a potentially debilitating hit.
For example, say that you’re a personal trainer. Your business involves traveling to your clients’ homes and bringing the workout to them. If you accidentally drop a heavy dumbbell and damage their expensive flooring, general liability insurance can help cover the cost to repair the damage.
Or maybe you have a construction business and, while remodeling your customers’ garage, a loose bolt gives way, causing a beam to drop and injure a passerby. In this scenario, you may be liable for some pretty hefty medical expenses that general liability insurance can help cover.
To get general liability insurance, click “Get a Quote” here or download the Thimble app, choose your profession, answer a few quick questions and get your quote instantly. Click once to purchase and you’re good to go.
It’s important to note that general liability insurance will not cover an employee injury. For that, you’ll need workers’ comp (which we’ll cover below). General liability insurance also does not cover the damage done to your personal equipment or property. For that, you’ll want commercial property insurance (also covered below).
How to get professional liability insurance
Sometimes referred to as errors and omissions insurance (E&O), professional liability insurance protects you when a client claims that you didn’t do your job right. Now you might think that’s a pretty subjective determination, right? In many cases, you’d be right. But, even if the claim is frivolous, you could end up in court if your client sues, claiming that you did not deliver on the services you promised. That’s when professional liability insurance kicks in. Professional liability insurance will provide for the investigation of claims made against you, along with your legal defense and court-ordered payments for covered claims related to negligence.
Imagine, for example, that you’re a career coach, working tirelessly to help your clients achieve their professional goals. You create long-term plans and frequently offer advice. What if one of your clients follows your advice and, instead of receiving the raise you counseled him to request, gets a demotion instead? Maybe he didn’t approach it in the way you recommended, but it doesn’t really matter because he blames you, and now he’s suing.
Or, say you’re a professional photographer, and you’ve just finished your best wedding shoot yet. You send your clients a link to their gallery and, to your surprise, they absolutely loathe the pictures and blame you for failing to capture their special day in the way they had in mind. They file a claim saying that you were negligent in your work.
For scenarios like these, professional liability coverage can help protect your business should a client accuse you of being negligent in your work or claim that you breached your contract. Thimble offers professional liability insurance for around 30 types of businesses, and you can get insured in under 60 seconds.
How to get commercial property insurance
If you have business property, whether that’s a building you own or business contents inside of a building you own or lease, commercial property insurance will cover loss or damage to your property for incidents, such as fire or theft.
Let’s say you’re a restaurant owner and a kitchen fire escalates into a full-on blaze that burns your entire building down. Commercial property insurance can cover the cost to repair your building and replace your business items inside your building or within 100 feet of the premises. Plus, until you can get your business up and running again, business interruption insurance will cover your expenses and lost income until you can safely reopen.
At Thimble, commercial property insurance is available as part of a Business Owners’ Policy (BOP). A BOP is an attractive solution for many small and medium-sized businesses because it conveniently and affordably bundles commercial property insurance and general liability insurance into a single policy. You’ll need to provide several details about your business and location, but getting covered takes just a few minutes.
How to get workers’ compensation insurance
If you have at least one employee, your state may require that you purchase workers’ compensation insurance, which covers your employees for work-related injuries and illnesses.
If, for example, you own a landscaping business and one of your employees gets injured on the job, workers’ comp insurance may cover their medical expenses as well as a portion of their lost wages until they can safely return to work.
As mentioned, almost every state will require you to purchase workers’ comp insurance if you have employees. Even if it’s not mandated by law, however, it’s still a very good idea. Not only does workers’ comp insurance protect your employees, but it can also safeguard your business from the financial consequences if you get sued by an injured employee. Check this handy map to see if Thimble writes workers’ comp in your state.
Reviewing your business insurance quote
Once you understand what type of coverage your business needs, you’ll want to provide some information about your business in order to get a quote. At Thimble, we make getting a quote pretty simple. To recap, simply click “Get a Quote” or download our app, answer a few easy questions, and you’ll receive a quote in a matter of just a few minutes.
Once you’ve received your quote, be sure to review the terms. If the terms are agreeable and everything is in order, then you can purchase and receive your Certificate of Insurance right away. Below are some of the key factors to review:
- The policy limit: Arguably the most important line-item of your insurance policy, the policy limit is the amount you’re insured for. It’s typically a big number, like $1 million, and it’s the maximum amount the insurer would pay for claims involving your business.
- Inclusions & exclusions: If you do not know your inclusions and exclusions, then you don’t understand your insurance policy. Be sure to look into exactly what the policy includes or excludes, as this will determine the terms of your policy and influence the rate.
- Deductible & premium: Your insurance deductible is the amount you are responsible for out-of-pocket when you file a claim. This is the money you have to pay before the insurance takes care of the remaining amount up until your policy limit. Your insurance premium is how much your insurance policy costs you.
If, after reviewing your policy terms, you are not satisfied or if it excludes certain liabilities that you need to protect against, you will need to adjust your policy accordingly. For instance, if your line of work has a high inherent risk, additional coverage may be well worth the cost and can provide an additional cushion against high compensation figures sought by plaintiffs. This is common for professionals like:
- IT consultants
How to get hassle-free business insurance
We know, purchasing commercial insurance may be one of the least sexy things about running a business. But it’s extremely important for every business to safeguard against the most common risks you face daily. And worry not. At Thimble, we do our best to get rid of the confusing jargon and the complicated processes.
Simply click “Get a quote” or download the Thimble mobile app. From there, we’ll need some basic information from you, including:
- Details about your business or practice
- Your ZIP code
- Desired coverage length (choose from hourly, daily, monthly — Yes, we allow you to purchase coverage that makes the most sense for your business!)
Once we’ve collected a few details from you, we’ll generate a policy quote that outlines your costs. Really — it’s that easy. After you’ve clicked “purchase,” we’ll send a Certificate of Insurance (COI), your proof of insurance, directly to your inbox.
Additionally, you can pull up the COI from the Thimble mobile app, having it on hand wherever you go. Should you need to add Additional Insureds or request more COIs, you can do it all free of charge. And, if for whatever reason you need to cancel, you can, penalty-free, up to an hour prior to when the terms begin. That’s insurance made simple. That’s Thimble.