Owning a business comes with countless risks. Unforeseen events occur all the time, and without proper protection, there is potential for your company to experience serious financial hardships. This is why it’s important to invest in the right insurance coverage. While there are many options available, entrepreneurs often choose to start out with a business owner’s policy. This can offer considerable savings, though it’s not a good fit for every situation. Below are the answers to a few common questions that can help you determine whether or not to buy this type of policy.
FAQ About Business Owner’s Policies
What is a business owner’s policy?
A business owner’s policy is a commercial insurance package designed to include both general liability and property insurance. Typically, the incentive for buying the bundle is that the premium will cost less than buying each kind of coverage separately. In some cases, a business owner’s policy may also include business interruption insurance, which covers income loss should a company have to shut down temporarily after disaster strikes.
Who is eligible to purchase a business owner’s policy?
Business owner’s policies are sold only to small business owners. Generally, a company is classified as a small business if it has fewer than 100 employees and earns less than a million dollars in annual revenue. There are other eligibility requirements as well. For example, if you operate a business in a risk-prone industry or require high coverage limits, you may no longer qualify.
Who needs this type of coverage?
General liability and property insurance are two types of coverage most small businesses will need. They help protect against lawsuits due to third party bodily injuries or property damage, as well as damages done to the building a company operates out of and the contents within. It’s also common for small businesses to need liability insurance to sign a lease or contracts with clients.
Can a business owner’s policy be modified?
A business owner’s policy can be modified to include extra coverage to a certain extent. Endorsements may be added to a policy to cover specific risks, such as floods and earthquakes. The price of an endorsement won’t be discounted like the rest of the policy, but it will provide more coverage for property damages.
If you need further clarification on how a business owner’s policy can benefit your business, contact NorthEast Insurance Services. They will walk you through all your coverage options and assist you in finding the most suitable coverage for your company’s specific needs. They offer a broad selection of products and have been entrusted to help numerous Freehold, NJ, entrepreneurs put together a policy that provides adequate protection. Call (732) 972-1771 to schedule an appointment or visit them online for more information on their wide range of services.