Why You May Be Required to Have Business Insurance
Why You May Be Required to Have Business Insurance
You are likely aware that laws in just about every state require you to have automobile insurance. If you have a mortgage on your home, your bank or mortgage company may require you to carry home insurance. But what about business insurance? While, generally, laws do not require a business to carry business insurance, there are situations where it may be mandated.
You Have Employees
Worker’s Compensation is required for businesses with an employee. This is a form of insurance provides medical coverage as well as replacement income if they cannot work due to being injured on the job.
The income of employees who may be injured on the job while offering financial protection to the business owner. Businesses with employees are required to carry Workers’ Comp.
You Have a Business Loan
Like with an outstanding mortgage, a financial institution that lends you money for your business may require you to carry business insurance to protect their interest. This can depend on the purpose and size of the loan and your lender.
You Rent Space
Even if your business doesn’t own real estate, a landlord may require you to carry business insurance to lease commercial property.
You Are a Business Professional
Some states and business organizations can require certain professionals, like those in the medical, legal, or financial fields, carry business insurance, especially Errors and Omissions Insurance. This is a form of malpractice insurance that protects against professional errors.
Your Business Owns Vehicles
Whether your business owns a single vehicle or an entire fleet, it is required to carry the minimal coverages allowable in the state. Even if you use a personal vehicle for business, you may be better served by having business vehicle insurance to make sure you are properly covered.
Manufacturers in certain business categories may also be required to carry product liability insurance, like pharmaceuticals. Your specific business association can provide guidance on if and when such insurance is required for your company.
Even when business insurance is not mandated, it is still a sensible idea. It can protect inventory, insure income, minimize financial damage from liability claims, and protect against losses from theft, fires, and storm damage. For a no-obligation quote, contact one of our business insurance professionals today. They can assist in guiding you through what may be required and what is in your best interest. Contact us today.
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