When you own a business, many types of insurance are beneficial. Two of the most important are commercial property insurance and general liability insurance. They work together to protect your business from different financial losses. Understanding each type of insurance and how it works is essential to safeguard your company's financial security.
Commercial property insurance pays to repair or replace commercial property if it is damaged or lost due to fire, theft, water damage, and other listed perils. It generally covers equipment breakdowns, buildings, goods, gear, inventory, and interruptions that affect the business's operations. It is also known as business personal property insurance.
You need commercial property insurance if you own your business location and have equipment or inventory. It is also beneficial if losing your business assets disrupts your ability to operate normally. Commercial property insurance is also needed if you lease or rent your space and any equipment you use to manage your business.
Liability insurance covers the cost of damages or injuries incurred by someone else caused by your company, its products, or its services. It offers protection against lawsuits that arise over business disagreements. There are many types of liability insurance, each covering a specific issue. A few of the most common types are Error & Omissions, product liability, and general liability.
Almost every business faces some liability risk. All risks include an allergic reaction to a product, a slip-and-fall accident on your property, or inaccurate information that leads to financial loss. Every business is open to a unique set of risks, so the type of liability insurance needed will differ from company to company.
Commercial property and liability coverage don't overlap. These cover two different aspects of a business. Commercial property insurance protects the business from the loss of its physical assets. Liability insurance protects the business's financial assets if a third party is injured or their personal property is damaged due to the activity of your company.
In most cases, both types of insurance are needed. Even if you are a service-based business, you will still have some physical assets associated with your business. There are many types of liability insurance as well. Talk to your insurance agent to determine what types your business will benefit from.
You can buy one type of insurance with another, but most insurance carriers commonly bundle them together. It will ensure all aspects of your business are fully covered, and you will have the peace of mind you deserve.