When you own a business, you don't want anything to happen that could threaten your career and livelihood. For this reason, it's critical that you have a business insurance policy that protects you and your company from liability lawsuits. However, you may not know just how much insurance you need to have.
The answer to this question depends on a number of factors. For example, if you're required to purchase a liability insurance policy because it's in your contract or lease, you'll be told the minimum amount you must have. Rental contracts often have a minimum requirement of $1 million limit per occurrence and an aggregate limit of $2 million. This can vary, though, based on your industry, since some businesses, such as those in the medical field. are riskier than others.
Approximately 88% of businesses choose a general liability policy that has a $1 million per occurrence limit and a $2 million aggregate limit. However, they also usually have other policies that cover more than just the basic liability claims, which include bodily damage, property damage, and medical expenses. There are many other risks that a business faces today that a general policy may not be enough or cover every potential peril.
You never know when your company could be the target of thieves or mother nature. A business income insurance policy will cover the income you lose from a natural disaster like a fire or excessive wind.
For instance, if your company was damaged by a fire and you're unable to operate for a period of time, this policy would cover costs until you're able to reopen. This is also true for a theft that prevents you from operating for a time.
You can get a combined liability and property policy combined into a single business owner's policy. This integrated insurance policy will protect you from covered disasters like fire and theft, as well as from claims that are filed against your company for bodily injuries and property damage. You will also be protected from lawsuits arising from personal and advertising injury.
Not all companies will need the same amount of liability insurance because the risk level for each company varies. You may want to consider additional coverage if you operate in an industry at higher risk of lawsuits (any business that interacts directly with customers, like medical companies), have low revenue (unable to pay expenses without insurance), or you have a higher risk of being named in a chain lawsuit, which means you're one of many companies involved in projects.
When a liability lawsuit is filed, the plaintiff's attorney will name any and all companies involved as defendants in the event that triggered the lawsuit. Even if you're only tangentially involved in a project, you could still be named in a liability lawsuit. You will want to take steps to protect yourself against the mistakes of other companies by purchasing more insurance.
Don't take the chance that your company could be sued for liability and not be able to continue operations. Contact Society Insurance Network to find out how to fully protect your business today.