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7 Types of Small Business Insurance You Need to Stay Protected

Posted by Pekin Insurance on May 16, 2018

Did you know there's more than one way to protect your dream? Find out what types of small business insurance can help you keep your livelihood secure.

It takes time, money, inventory, inspections, contractors, advertising, and so much more to start a small business. It takes mere moments for a disaster to wipe out that work. That’s why it’s essential to have the right types of small business insurance.

Ask a few entrepreneurs about their startup costs or monthly overhead and you’ll get answers as different as can be. You could scrape by with around $15,000 to open a bakery, assuming you can do most of the work on your own. A small gym may be about the same. A brewpub could easily be closer to $100,000 to get up and running, while you’re looking at a minimum of $50,000 as the average cost of opening a clothing boutique.

Monthly overhead can get up there, too. Between your lease, utilities, equipment rental, shipping costs, office supplies, and other monthly expenses, you’re putting a lot into your business. To protect that business, it’s vital to make sure you have the right types of small business insurance.

Business insurance, more often than not, is not a single insurance policy. Because every business is different, there are different types of small business insurance that get rolled into a single policy specially designed to give you the protection you need. For instance, while liability insurance is standard for a business, not every company will need a commercial auto insurance policy. So what does your small business need? In addition to general liability insurance and workers compensation insurance (which is required by law in most states), there are some insurance coverages that could help your business thrive in a time of uncertainty.


7 Types of Small Business Insurance
that you didn’t know you needed.

1. Data compromise coverage
You can take steps to secure your digital information, but there is always a risk that information could be compromised. While the big companies make the news for data leaks, your small business is more likely to be a target. In fact, 61% of data theft victims last year were small businesses

Data compromise coverage helps your business recover and may even help your customers, clients, and employees if their information is hacked.

2. Equipment breakdown coverage
Whether it’s a leaky HVAC system, a walk-in breakdown, or an electrical malfunction, if your equipment isn’t working, neither are you. But equipment breakdown coverage doesn’t just help your business repair or replace the broken item; it may also pay for lost business income, perishable goods, and other expenses.

3. Employee theft and dishonesty coverage
No matter how careful you are in the hiring process, you will eventually hire a dishonest employee. An article in Security magazine notes that 68% of employee theft cases happen in small and mid-sized businesses, and the “median loss” is $289,864. 

That kind of loss can put a small business out of business or at least make it hard to keep the doors open. As part of the Pekin PAK Program, employee theft and dishonesty coverage could buttress your business against these losses.

4. Errors and omissions coverage
This is an especially important insurance enhancement for contractors. Accidents happen, and an oversight on your part or a defective product can turn into expensive repairs. Errors and omissions coverage can help your small contracting business stay afloat in the face of these additional expenses.

5. Business income coverage
How much income would you lose each day if you had to close your business for an emergency? Business income coverage provides compensation to a business for that loss and may be the key to helping you keep your doors open.

6. Employment practices liability coverage
Even if you aren’t at fault, defending yourself against an accusation of illegal employment practices, such as discrimination, harassment, or wrongful termination, is an extensive and time-consuming process. It’s also expensive. Employment practices liability coverage can support you through this trying time and help you get back to focusing on your business as soon as possible.

7. Outdoor property coverage
If your business has outdoor landscaping, such as a fence, plants, or trees, outdoor property coverage can help you recoup the expense if they are destroyed. Though most of us may not think about insurance coverage for the trees adorning our business property, a trip to a plant nursery is a good reminder of how much they can cost.


Don't leave your small business unprotected. Call your Pekin Insurance agent today to learn more about business insurance.



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