Types of Insurance

6 Types of Insurance Every Small Business Needs

Running your own commercial trucking business has some obvious needs. But the world of small business insurance is vast. Knowing which type of insurance policies, you’re legally required to provide for your drivers is one thing, but what about protecting your own business?

It doesn’t matter if you are starting your own trucking business or have been operating for years. There are many policies you can benefit from. We explore six types of coverage you should consider to be essential in protecting your business. 

General Liability Insurance

Small businesses aren’t required to purchase general liability insurance. This doesn’t mean they should never go without it. There are higher risks of injury in the trucking business. If someone gets hurt on the road or even on your property, this policy will protect you from covering the other party’s cost of their medical care.

Liability insurance also covers damage to other people’s property you or one of your employees cause when not driving. Advertisement injuries, such as slander or misrepresentation, are also included in the policy form. Businesses with higher injury risks like trucking should always have a general liability policy.

Commercial Property Insurance

You may operate out of your house at first. As you expand your business and acquire your own office, you’ll want to make sure it is as well-insured as your rigs. Property insurance covers your physical property as well as any equipment on its premises. Contents can also be insured.

Property liability policies also have the option for business interruption insurance. This add-on coverage helps compensate for lost income in the event of a fire or other damages that disrupt your business. Your business’s location and type of construction will influence the limits of your property insurance. For example, an office in Oklahoma may be able to expand coverage limits to protect against tornado damages. 

Cyber Liability Insurance

In a technology-driven world, you need to protect all the vital and confidential information stored in your business’s hard drives or data cloud. Cyber insurance helps businesses recover from the costs of losing data due to a data breach, computer virus, and other types of cyber security attacks.

The costs of a data breach can be substantial. Every state has differing notification laws requiring businesses to communicate to all known contacts if a breach occurs. This alone can run into the tens of thousands of dollars. For trucking operations with few contacts, there remains the risk of “bricking” which occurs when your computer is highjacked. There also are false pretense and social engineering schemes which could result in the inadvertent transfer of your hard-earned money. Cyber liability insurance, whether as a stand-alone policy or as an endorsement to current coverage is a must-have in today’s digital world. 

Crime Insurance
Every business handles money in one way or another. Money and other financial instruments are not “property” or “contents” under your property policy and are therefore not covered if stolen. Theft of money can occur in a variety of ways with employee theft being the most common.

Transfer fraud, or the illegal movement of funds between accounts, is becoming more prevalent as banking becomes more digitized. Less common, but still practiced is the forgery and alteration of financial documents such as checks. Lastly, computer fraud is on the rise. This occurs when thieves alter programs that financially benefit themselves and steal from the business.

 

The theft of money from a business can occur over long periods of time and amount to significant sums. Crime insurance can fill in the gaps found in other insurance policies. 

 

Employment Practices Liability Insurance

Employees can sue their employers for a variety of reasons, including wrongful discipline or termination, sexual harassment, discrimination, negligence and mismanagement of benefits. If a former driver or even current employee decides that they have been treated unfairly by your business, they can decide to sue you for compensation.

Employment practices liability gives you protection against employee lawsuits. Even a failure to promote or issue a sign-on bonus can result in a legal case. Many large corporations have strict employee practices that can be used to defend themselves in the event of a lawsuit, but small businesses are usually not as fortunate.

Even interviewing potential drivers or employees puts you at risk. Hopefully, you’ll never need to use this coverage, but you’ll be extremely grateful to have it if you’re faced with a lawsuit. 

Umbrella Policy

Umbrella insurance for small businesses can help bolster gaps in your other policies. In general, this type of policy provides coverage for exceptionally large losses or damages.

Umbrella insurance can be applied to multiple liability policies at once, including general and employee practices liability. It can also cover additional costs that might not be covered by your existing policies such as legal fees and medical expenses.

If you find that you do not qualify for an umbrella policy, you can also consider an excess insurance policy. Excess insurance coverage functions the same as an umbrella policy, except it provides coverage over a specific coverage type. 

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