What different business insurance coverage are required to effectively safeguard your US-based firm? How can insurance be used to protect your business?
This post will outline the six most ignored commercial insurance plans that could make the difference between keeping your company operating and permanently closing it:
1. Cyber Insurance
Table of Contents
Cyber insurance is just as challenging to comprehend. The wording must be carefully examined by an experienced agent because there is no such thing as “standard” insurance.
This material is typically pretty basic, and it probably won’t address current problems that firms are facing like phishing or ransomware.
Ask for a quote on a standalone, independent cyber policy; you may discover that the price isn’t all that much higher for significantly greater coverage.
2. Non-Owned or Hired Auto Insurance
If your business doesn’t own any automobiles, you might suppose you don’t need this one. On the other hand, Hired and Non-Owned Auto Liability was created especially for businesses without commercial vehicles. Although there are essentially two separate coverages, they are frequently combined in insurance discussions.
Liability Insurance for Non-Owned Automobiles
The company is helpless if you or your employees drive personal vehicles for work-related objectives. A personal auto policy does not provide coverage for a business. For instance, if one of your employees walks outside to make a bank deposit and has an accident, they are personally responsible. The business, though, can also be held accountable. Non-Owned Auto protection safeguards the business’s assets.
ALSO READ:
Hired Auto Liability Insurance
If you or your employees rent or lease cars for work-related activities, you must have this insurance. Renting cars is the most frequent scenario. Your employee will be held responsible if an accident happens when they are driving a rental automobile to a convention out-of-town for work-related reasons. They are vicariously liable and may have to pay out of pocket if the company does not have Hired Auto Liability.
Coverage for Other Automobiles
If a corporate car is allocated to you but you do not own a personal vehicle or have personal auto insurance, you should add Drive Other Car Coverage to your Commercial Auto policy.
Remember that your commercial auto coverage could not cover vehicles that aren’t owned by the employer if you ever need to borrow or test drive a car for personal purposes. This could leave you exposed.
.
3. Employment Practices Liability Insurance (EPLI)
Consider purchasing an Employment Practices Liability coverage if you have employees. This coverage can pay for your company’s legal expenses and other expenses if there are any allegations of unfair hiring or terminations, harassment, gender discrimination, incorrect salary payments, or other similar problems.
It shields the business from accountability not only if they are the ones being accused of abuse (first-party liability), but even if third-party employees of your business, such vendors or delivery drivers, engaged in harassment.
Insurance industry analysts predict an increase in Employment Practices claims for a number of reasons, including risks associated with temperature checks, remote working conditions, pay issues, whistleblowing, and retaliation.
How much does a typical Employment Practice Liability Insurance claim cost? EPL claims often cost between $50,000 and $70,000. Some jury verdicts think there may be more to it.
4. Professional Liability Insurance (or Errors and Omissions)
The need for professional liability insurance is growing. The target market consists of lawyers, accountants, doctors, engineers, insurance agents, realtors, and other professionals who offer professional services. You will need a specific amount of coverage when the final result is expert advise to safeguard yourself against legal fees and the effects of your counsel.
It is now readily accessible for contractors, advertisers, and consultants of all kinds as more firms need this coverage. For instance, an HVAC contractor who focuses on system maintenance might not need professional liability insurance.
But if they deviate from the original system design while performing their duties and the HVAC system fails as a result, it can be viewed as expert advising outside the normal course of duty and subject them to professional responsibility. The General Liability policy can expire without this protection, leaving the business liable for the harm.
5. Employee Benefits Liability
If your business has employees and offers benefits like health insurance, pensions, vacations, tuition assistance, unemployment insurance, etc., then you must have this coverage. You are shielded from any administrative oversights or incorrect benefit descriptions on the part of the business.
Benefits administration takes a lot of work, and mistakes might happen. If a new employee was mistakenly left off the health insurance and had a serious injury six months later, only to learn their health insurance was not in effect, Employee Benefits Liability, for instance, may take action. If not, your employee will likely file a lawsuit against the business to recover the costs of their medical care, which will, at the at least, make the workplace unpleasant for everyone.
In 2018, the US Bureau of Labor Statistics published a report estimating the average annual cost of employee benefits per employee to be $21,726.
6. Foreign Liability as One of the Most Vital Business Insurance Policies
Depending on the sort of business you operate and how frequently you go abroad for work, you might need to take into account foreign liability coverage. It includes claims and lawsuits brought in other nations as well as incidents of personal injury and property damage that take place abroad.
A typical general liability policy limits coverage to lawsuits filed in a certain jurisdiction, which is frequently the US, Canada, and PR. Most people refuse to pay for legal bills or cases brought before courts in foreign nations. This is one of the commercial insurance plans you’ll require if you’re flying from the US to Dubai or Saudi Arabia.
A universal approach to foreign policy is impossible. Because there are so many different potential issues to take into account, organizations with overseas risks should think about consulting with an experienced insurance broker and/or coverage counsel to advise them and negotiate optimal policy language suitable for their risk environment, according to Risk Management Magazine.
