Liability Insurance Can Protect Your Small Business
A Home Business Article Contributed by Elizabeth Fox-Wise
Most Small Business Owners Could Benefit from Carrying Liability Insurance
The majority of small business is either a sole proprietorship or a partnership, both of these types of business really need to carry liability insurance. Owning either of these types of businesses puts both your business assets and your personal assets at risk if you are not carrying liability insurance.
Liability insurance protects your small business should there be a lawsuit resulting from personal injury or property damage. The nature of your small business and your insurance needs will determine the type of liability insurance that your small business should carry.
Types of Liability Insurance for Your Small Business to Consider
There are three types of liability insurance from which you can choose. These are General Liability Insurance, Professional Liability Insurance and Product Liability Insurance.
General Liability Insurance is a business insurance which protects your small business from lawsuits resulting from injury, property damage and advertising claims. This is the most common type of liability insurance and is sufficient for many small business' needs. This insurance is also known as Commercial General Liability (CGL).
Professional Liability Insurance might be needed if your small business provides a service. This type of liability insurance will protect your small business from malpractice, mistakes and negligence in the course of providing your service.
Product Liability Insurance should be considered if your small business is selling or manufacturing a product. This insurance will protect your small business should a customer get hurt while using your product.
How Great of a Risk are You Running If Your Small Business Does Not Have Liability Insurance?
The risk of operating a small business without liability insurance should be looked at the same way you look at the risk of foregoing any insurance. Are there many small businesses operating without liability and insurance and not having problems? Of course; the same as there are many individuals living without health insurance. Are some of them living without health insurance and not feeling the effects? Of course - those who are healthy and have no need for medical care.
But what about the people who are foregoing health insurance and then have a major health problem? Their medical expenses often eat up their savings and can put them into heavy debt. That is the same as the small business who has no liability insurance. They may operate fine for years with no problems. But then all of a sudden something goes wrong and they are hit with a large lawsuit.
The results of the lawsuit could cost the small business owner to loose not only his business assets but also his personal assets.
Lawsuits are so common in America, that the chances of your small business being faced with one some where within the life of the business are pretty high.
When considering liability insurance you should shop around for the best rate. The rates being offered to your small business for a liability insurance policy, as well as what that policy will cover, will vary from insurance agent to insurance agent. Be sure to do your homework, evaluate your options and make an informed business decision.
