The great state of Texas is, in so many ways, a maverick. It’s known for the Lone Star, its independent, free-wheeling nature, and a friendly business climate. These factors make it an enticing destination for companies looking to relocate,
particularly from California. If you own and operate a business in Texas, the insurance laws are less stringent than other states. That said, there are still types of insurance coverage you should consider purchasing since they protect you from a variety
of liabilities. Below, we’ll cover everything you need to know about business insurance in Texas.

Texas insurance laws

Unlike most states in the nation, Texas only has one business insurance law on the books. While every other state requires that a company with a specific number of workers obtain workers’ compensation, Texas doesn’t. And the
same goes for a disability coverage insurance policy. In Texas, the only type of insurance policy that is legally required is a Commercial Auto Insurance Policy Even though commercial auto insurance is legally required, the mandate only
applies to businesses that own work vehicles and use them primarily for work purposes, including:

  • Having a vehicle titled to the business
  • Driving the vehicle to and from work
  • Transporting clients or employees in the vehicle
  • Carrying tools, products, or work equipment

This type of coverage protects the business and the employee for liability in the case of an accident that causes personal injury and damage to the vehicle or property. Without it, the business owner could face lawsuits and be taken to court for property
and bodily injury damages. But it’s not enough to simply have an auto insurance policy. Texas state law requires that a commercial auto policy contains the following minimum policy limits:

  • $30,000 bodily injury liability per person
  • $60,000 bodily injury liability per accident
  • $25,000 property damage liability per accident

In addition, although it’s not mandated, it’s recommended that personal vehicles used primarily for work obtain a separate auto insurance policy, since personal auto policies tend to exclude business uses. Just so you’re aware, failure to comply with
Texas law can result in any of the following penalties against small business owners.

  • Mandated cessation of work
  • Fines and fees
  • Criminal charge

Small business insurance policies

Although the list of legally required small business insurance policies in Texas is quite short, there are a variety of policies that most any lawyer or insurance professional would strongly recommend you purchase
to ensure liability coverage. These protect you from the most glaring liability exposures that come with owning a business, including: Workers’ Compensation Just because Texas doesn’t legally require a business to have workers’ comp,
that doesn’t make it a wise business decision to go without. Whether you hire workers on a part-time or full-time basis, it would be smart to invest in a policy to ensure that you and your employees are protected and compensation is not an issue in the
case of personal injury. Even in the best work environments, all it takes is one employee slip for an injury. And if you don’t have workers’ compensation, you could be sued for negligence. On the other hand, a small investment in workers’ compensation
would shield the business from work-related injuries or accidents that occured on site. It would cover the various costs, including:

  • Medical expenses
  • Surgery
  • Physical Therapy/Rehabilitation
  • Disability
  • Lost wages

Cyber Liability Insurance In the digital age, practically every business relies heavily upon its electronic interface and machinery. From data to proprietary information, there are all sorts of enticements that might draw cyberattacks.
Cyber liability insurance protects a Texas business from data breaches and cyberattacks by paying for the following:

  • Fraud monitoring costs
  • Cyber extortion payments
  • Legal fees
  • Data breach lawsuits
  • Client notification expense
  • Business interruption expenses
  • Settlements and judgments

General Liability Insurance Every businessperson in Texas should have general liability insurance. This type of policy protects
businesses from the various risks that can happen to third parties during the course of any given day, like:

  • Property damage
  • Bodily injury
  • Medical expenses
  • Reputational harm

Naturally, you may be curious why a general liability policy would be a worthwhile investment to protect your business. In which case, consider the following situations: A client and an acquaintance visit your new office in order to check it out, chat,
and drop off some signed documents. While there, his acquaintance trips over one of the unpacked boxes and hurts his wrist. Now, he’s going to need surgery and wants you to pay for it. He alleges a bodily injury claim against you. If you want to fight
it, you’ll have to hire a legal team to defend you in court. For this situation, a general liability insurance policy can help protect the business owner. Professional Liability Insurance Professional liability insurance, which is sometimes referred to as an errors and omissions policy (E&O), is an insurance policy for professionals that offer advice and consultation (or whom others go to for
their expertise). This type of policy protects a variety of professions from negligence and damage claims resulting from previous recommendations. Say, for instance, that you’re a career coach helping someone get the promotion they want. When your client
misinterprets your advice, they behave in a way that results in them getting demoted—the exact opposite of what they wanted. They then sue you for negligence, claiming that because of your advice, they not only lost the money they were making, but also
lost the amount they would’ve made had they been promoted. In such cases, a professional liability policy can help pay for damages and legal fees, regardless of whether or not you are at fault.

How to get business insurance in Texas?

If you have business operations in Texas, Thimble makes it easy and affordable to get a general liability and professional liability insurance policy. Thimble’s on-demand policies aren’t your ordinary, expensive
insurance plans. Instead, we let you choose a business owner’s policy that goes by the hour, day, or month. Our policies are so affordable because they work when you do. You can choose a policy limit of either $1,000,000 or $2,000,000. Click “Get a quote”
or download the Thimble app, input a few details about your business, enter your ZIP code, then choose the length of your desired business insurance coverage and we’ll generate a quote instantly. Once purchased, your COI is delivered directly to your
inbox or you can have it on-hand through the Thimble app. From Brownsville to Amarillo, Beaumont to El Paso, and everywhere in between, Texas businesses need Thimble.